Embracing Technology in the Canadian Construction Industry: A Necessary Evolution

In recent years, the Canadian construction industry has found itself at a critical juncture. With increasing pressure to build more efficiently and rapidly, a new report from KPMG in Canada indicates that a staggering nine out of ten construction leaders believe embracing advanced technologies is not just beneficial but essential. These leaders are recognizing the transformative power of digital tools, as many report that their productivity is already on the rise.

The Call for Investment in Technology

Tom Rothfischer, Partner and National Industry Leader for Building, Construction, and Real Estate at KPMG, emphasizes the pivotal role that investment in technology plays. He states, “It’s good to see that the sector is investing in the technologies that are desperately needed to address persistently poor productivity levels.” While the current economic climate presents its own challenges, such as increased costs and global trade uncertainties, the urgent need for innovation remains clear. Rothfischer argues that these technological investments are crucial for addressing Canada’s housing supply issues and for embarking on significant nation-building mega-projects.

The Role of Clients and Procurement Trends

Construction clients — those who commission and fund projects — can significantly influence the industry’s modernization efforts. According to the KPMG report, nearly 78% of clients indicate that procurement processes are evolving to favor innovation and the adoption of digital tools. Furthermore, 43% of clients report that they play a "highly influential" role in their contractors’ technology adoption decisions.

Rodrigue Gilbert, President of the Canadian Construction Association, acknowledges the momentum but stresses that progress is slow. He warns that current procurement models often prioritize the lowest price over long-term value, thereby stifling meaningful investment in innovation. “If we want a modern and productive construction sector,” Gilbert asserts, “governments must reform procurement to foster collaboration and ensure fair risk-sharing.”

Addressing the Labour Shortage

Another urgent concern is the looming labour crisis in the construction sector. With a significant portion of the workforce nearing retirement, the industry faces a 73% expectation that it will struggle to meet demand in the coming decade. Many companies are already experiencing a skilled labour shortage, which is hindering their capacity to both initiate new projects and complete existing ones.

Jordan Thomson, KPMG’s National Sector Leader for Building and Construction, highlights that while the situation has slightly improved from two years ago, the challenges remain significant. He notes, “The pressure is intensifying on the construction industry to do far more with less.” The removal of interprovincial trade barriers and the establishment of streamlined regulations are essential steps that can help mitigate these challenges.

Technology Adoption: Trends and Innovations

The KPMG report outlines a significant focus on deploying diverse technologies aimed at enhancing productivity and expediting project completion. An impressive 81% of construction companies surveyed stated that recent investments in technology are already yielding positive outcomes. Some of the most promising innovations include:

• Modular and Prefabrication Construction: This method allows buildings to be constructed in a controlled factory setting before being assembled on-site, significantly reducing waste and time.
• Robotics and Automation: Technologies like robotic bricklaying offer opportunities to improve not only productivity but also safety on construction sites, alongside using drones for efficient site surveys.
• Building Information Modelling (BIM): This digital framework improves planning and collaboration among stakeholders and provides a comprehensive view of the project from inception to completion.

In a rapidly evolving landscape, creating a demand-driven supply chain that aligns supply with real market needs has emerged as a top priority for 56% of construction leaders.

Challenges in Supply Chain Management

The report highlights the ongoing challenges in supply chain management that the industry faces. Issues such as rising material costs, U.S. tariffs, and lingering repercussions from the COVID-19 pandemic have intensified the need for supply chain innovation. Companies are increasingly investing in digital tools, data analytics, and automation to gain real-time visibility into their procurement processes.

The Path Forward: Integration and Upskilling

As the construction industry embraces these technological advancements, it is vital to recognize that investment alone is not enough. Effective integration of new technologies into existing practices is essential, as is the upskilling of the workforce to harness these tools successfully. Thomson points out, “Delivering returns requires careful integration, and only works if you also invest in up-skilling your people to use it effectively.”

Conclusion

The KPMG report paints a hopeful picture of the Canadian construction industry’s future, highlighting a growing commitment to technology and innovation. However, significant work remains to be done. From reforming procurement processes to investing in workforce development, all stakeholders must collaborate to navigate the challenges ahead and reshape the construction landscape in Canada. As the industry stands on the brink of transformation, the stakes have never been higher. The time to act is now.