BuildForce Canada predicts that Ontario's construction sector will expand through 2035, fueled by institutional projects and a residentiial rebound. While long-term demand is strong, the industry faces a significant labor shortage as thousands of veteran workers retire.
The 126,100-Worker Hiring Hurdle
The most pressing challenge for Ontario's building sector is a looming demographic cliff. According to BuildForce Canada, as many as 92,000 workers are projected to exit the industry due to retirement by 2035.. When this exodus is combined with the 34,100 additional workers needed to meet rising demand, the province faces a total hiring requirement of 126,100 workers over the next decade.
While the industry expects to recruit 98,800 new entrants under the age of 30, this influx is not enough to close the gap. The reports from BuildForce Canada indicate a potential shortfall of 27,300 workers by 2035. This labor deficit could create significant bottlenecks for both private developers and government agencies attempting to execute large-scale projects.
How Canada-US Tariff Disputes and Immigration Slow the 2026 Start
The path to growth is not linear, particularly for the residential sector. Irwin Bess, executive director of BuildForce Canada, notes that activity in the residential sector is projected to be constrained in the short term. This slowdown is attributed to uncertainty stemming from the ongoing tariff dispute between Canada and the United States, as well as reductions in immigration levels.
This volatility reflects a broader trend where Ontario's housing market is increasingly sensitive to geopolitical trade tensions and federal migration policy. Despite these headwinds, investment in new-housing construction is projected to return to growth by 2028. By 2035, residential construction employment is expected to rise by 11 per cent compared to 2025 levels, driven largely by a surge in renovations and new builds after the initial slump.
Nuclear Refurbishment and Transit in Hamilton and Kitchener-Waterloo-Cambridge
Non-residential construction is following a more robust trajectory, with investment rising notably since 2022. BuildForce Canada highlights that engineering construction will be a primary driver of this growth, specifically through major transit projects in Hamilton and Kitchener-Waterloo-Cambridge. These infrastructure plays are complemented by a range of utility-sector investments, including nuclear generation and refurbishment projects.
Beyond transit,the reports indicate that institutional and government buildings—specifically health care and education projects—will keep activity elevated through the late 2020s. While non-residential employment is projected to increase by a more modest five per cent by 2035 compared to the residential sector, the sheer scale of these ICI (industrial, commercial, and institutional) projects ensures a steady pipeline of work that is expected to peak around 2030.
The Uncertainty of Industrial Buildings and Unsold Multi-Unit Dwellings
Despite the optimistic long-term forecast, several critical variables remain unverified. BuildForce Canada explicitly states that the outlook for industrial buildings remains subject to uncertainty, leaving a gap in the data regarding whether the warehouse and logistics boom of previous years will persist. Furthermore,the report mentions an "abundance of unsold multi-unit residential dwellings" in some regions, but it does not specify which municipalities are most affected or why these units are failing to move.
There is also a notable silence on the specific funding mechanisms for the projected nuclear and transit projects.. While the demand is clear, the reports do not detail whether the necessary capital is already secured or if these projections depend on future government budget approvals. Without these details, the 2030 peak remains a projection based on intent rather than guaranteed contracts.
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