Non-residential investment returns to pre-COVID-19 levels in Canada
Total investment in building construction increased 12.0% to $14.9 billion in June, following the 62.2% gain observed in May.
Although COVID-19-related workplace guidelines remained in place for June, construction sites were largely back to normal activity, which contributed to gains in all components of residential and non-residential investment. Despite June's growth, investment in building construction remained 3.1% lower than February 2020, before COVID-19-related restrictions were first put in place. On a constant dollar basis, investment in building construction increased 11.7% to $12.1 billion in June
Non-residential investment higher than pre-pandemic levels
Non-residential construction investment increased 11.6% to $5.5 billion in June. Strong gains in Ontario and Quebec led to national growth in all components of non-residential investment, outweighing declines reported in all other provinces for the month.
With the strong increase in non-residential construction in June, investment for all three components is now higher than the levels recorded before COVID-19 restrictions were put in place.
The commercial component represented the majority of non-residential construction gains, up 14.7% to $3.3 billion, with notable increases in Ontario and Quebec. Alberta (-4.2% to $384.5 million) and British Columbia (-3.2% to $458.3 million) reported the largest declines for the month. The industrial (+7.7%) and institutional (+6.6%) sectors also increased in June, supported by strong gains in Ontario and Quebec.
Residential construction continues to recover
Investment in residential construction rose 12.2% to $9.4 billion in June, with gains in both single-unit (+13.0% to $4.7 billion) and multi-unit (+11.4% to $4.7 billion) investment. Ontario and Quebec led all provinces in growth for the month, while Saskatchewan was the only province to report a decline. Nationally, after back-to-back months of strong gains, residential investment still remained 8.6% lower than February 2020 levels.
Second quarter of 2020 down sharply
Public health measures put in place to slow the spread of COVID-19 severely impacted the construction industry in the second quarter. Total investment in building construction amounted to $36.3 billion, a decrease of 20.0% (-$9.1 billion) compared with the first quarter. This is the largest quarter-over-quarter decrease since January 2010, when comparable data were first available.
All provinces and territories were down for the quarter, with Ontario (-$3.4 billion) and Quebec (-$3.2 billion) posting the largest declines. This represented a record quarter-over-quarter decrease for both provinces.
Residential investment fell in the second quarter, down 24.5% to $23.0 billion, with both investment in multi-unit dwellings (-22.6%) and single-unit dwellings (-26.4%) posting sharp declines.
Non-residential investment decreased quarter over quarter, down 10.7% to $13.4 billion. Declines were reported across all provinces and territories, with the largest in Ontario.