Canada wants to build 400,000 homes a year. Who's going to build them?

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Canada wants to build 400,000 homes a year. Who’s going to build them?
© THE CANADIAN PRESS/Evan Buhler A sold sign is displayed in front of a house in the Riverdale area of Toronto on Wednesday, September 29, 2021. THE CANADIAN PRESS/Evan Buhler

The government has promised to build about 400,000 homes annually for the next decade.

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There’s just one problem: It’s not clear there are enough workers to build them.

“The reality is, they’re dealing with labour shortages, they’re dealing with material shortages, they’re dealing with all kinds of challenges in obtaining the material that they need to build homes,” said Jean-François Perrault, chief economist at Scotiabank.

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“So it’s not even clear that you’d be able to increase the (construction) pace significantly, given how challenging a labour and a material situation is facing the industry…right now.”

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The average selling price of a home in Canada has surged more than 50 per cent in the last two years, according to Reuters. Construction, meanwhile, has failed to keep up with the country’s growing population — in fact, a report published by Scotiabank last year found Canada has the “lowest number of housing units per 1,000 residents of any G7 country.”

About 286,000 new homes are currently built each year, according to 2021 data from the Canada Mortgage and Housing Corporation.

But the country’s housing supply is not keeping up with population growth. In 2016, there were 427 housing units for every 1,000 Canadians, and in 2020, there were was 424, according to a report Perrault published in May 2021.

During that time, Canada’s population grew by more than 1.3 million people.

Video: Is Ottawa’s help for 1st-time homebuyers enough?

There are a number of factors contributing to the housing crisis, including the supply chain snarls that are driving up material costs, and city councils that refuse to rapidly approve new housing projects.

But without the skilled workers who can take these construction materials and build these projects, Canada’s hope of building 3.5 million homes by 2031 may never become a reality.

While Canada has added more than 100,000 construction jobs in the last four months, the country needs to make structural changes to the education system, according to one construction industry representative.

Canada’s educational systems are, in many ways, geared towards churning out university applicants — not driving students towards hands-on apprenticeships, according to Richard Lyall, president of the Residential Construction Council of Ontario (RESCON).

“It’s really sad to see…you get kids that are coming out of high schools into nothing, when they have aptitudes for skilled trades, but they were never properly tested or identified or encouraged to pursue it,” Lyall said.

“We need to fix that.”

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The government needs to provide more support to employers so they can take on apprentices, Lyall said. In skilled trades, “80 to 90 per cent” of the education is done on site, he explained — but this reality is “not reflected” in the support employers get when it comes to providing apprenticeships.

However, the government took a step in the right direction with Budget 2022, according to Lee. The plan proposes new funding for the Union Training and Innovation Program, which it claims would help “3,500 apprentices from underrepresented groups begin and succeed in careers in the skilled trades.

If Canadians access these apprenticeships and are encouraged to explore careers in trades, they might find themselves better paid — and happier — than they would in another profession, according to Lyall.

“The wages are very high. The job satisfaction rates…are much higher than average. The wages are higher than average. There’s great careers there,” he said.

However, training Canadians from scratch to enter the trades isn’t a quick fix.

“The labour supply shortage is something that is a demographic situation that’s going to take a while to work itself out,” said Kevin Lee, CEO of the Canadian Home Builders Association.

Canada’s constructions goals, meanwhile, are ambitious, Lee said — which is why he said he was glad to see the budget turn to immigration to help address the issue.

“It’s going to take a lot of effort to get there…it’s going to take immigration. It’s going to take getting more people, more Canadians who are here already, young people, interested in the skilled trades,” Lee explained.

Right now, Canada’s immigration policies have a habit of targeting white collar workers or temporary foreign workers, leaving a gap when it comes to the kind of skilled labour needed to help build homes, Perrault explained.

“There hasn’t really been an attempt through our immigration policy to try and target folks that would be immediate value to the construction sector,” he said.

“I think that’s been one of the weaknesses. And it’s probably one of the reasons why the construction sector has a bit of a challenge finding workers.”

It’s going to take every level of government to tackle the housing crisis, Lee said. Municipalities will have to approve applications to build more housing while provincial and federal governments will have to make the policy changes at their levels, too.

“There’s three levels of government that have to be involved in this, and the feds have a certain leadership role in this,” Lee said.

In a statement sent to Global News on Monday, Housing Minister Ahmed Hussen’s office said it has made the “largest investment in training for workers in Canadian history” in a bid to tackle labour shortages.

“Moving forward, we have a plan to address these labour shortages,” they said.

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That plan includes immigration, affordable child care, support for training and youth employment programs and boosting workforce participation, they said.

“Our government’s plan to address labour shortages will make sure industries across the country, including construction, can grow and respond to the demand.”

Conservative interim Leader Candice Bergen has, however, slammed the government’s Budget 2022 proposals on housing.

“We were looking for…substantial action on increasing housing supply. The budget failed Canadians,” she said in a statement last week.

“Canadians are worse off today than they were six years ago.”

Meanwhile, Lee made his own pitch to Canadians who might be toying with the idea of entering a career in the trades.

“If you’re a young person looking for a career, residential construction is a great one,” said Lee.

“Lots of opportunities right now.”

— with files from Reuters

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