In the fall, Bank of Canada Governor Stephen Poloz characterized the country’s economy as having its head in the oven and feet in the freezer. For the construction industry specifically, total permit values are expected to fall 4 percent in 2018 after rising 1 percent in both 2016 and 2017.
Notably, the institutional sector would be up 2 percent if not for a pullback in health care construction. Vacancy rates are improving in Toronto and Vancouver, while more than a quarter of all office space is vacant in Calgary. Manufacturing permits are expected to increase 3 percent in 2018 to $2.4 billion; however, renegotiating NAFTA is a major risk to the forecast.