Nine in 10 construction leaders say digital tools are needed to boost productivity to build more and faster, according to a new KPMG in Canada report.
The report finds that the industry is focused on deploying a wide range of technologies to improve productivity and expedite project completion, with 81 per cent of construction companies saying their recent investments in technology are already making a difference.
“These investments are about to pay dividends and transform how we build in Canada,” said Tom Rothfischer, national industry leader for building, construction and real estate at KPMG. “But the current economic and trade environment is squeezing bottom lines, putting at risk much-needed continued spending on tech – technology that is essential if we are to address the chronic housing supply shortage in this country and transform our economy through an ambitious era of nation-building mega-projects.”
Nearly eight in 10 (78 per cent) say procurement processes are changing to encourage innovation and digital adoption, and 43 per cent indicated that their clients play a “highly influential” role in their decision to adopt technologies.
“It’s encouraging to see signs that procurement is beginning to evolve, but we’re not there yet,” said Rodrigue Gilbert, president of the Canadian Construction Association. “Too often, the system prioritizes lowest price over long-term value, which prohibits investment in innovation. If we want a modern, productive construction sector, governments must reform procurement to foster collaboration, ensure fair risk-sharing, and create the confidence companies need to invest and grow.”
The level of tech investment will need to ramp up given that the industry’s labour crunch is expected to worsen as the workforce ages and retirements increase in the next decade, the report points out. Nearly three-quarters (73 per cent) of construction leaders expect that it will become “increasingly difficult” to meet demand over the next five-to-10 years, particularly as retirements outpace recruitment.
“The pressure is intensifying on the construction industry to do far more with less,” says Jordan Thomson, director, Global Infrastructure Advisory, KPMG in Canada. “The industry is well aware of their labour conundrum, with eight in 10 companies still experiencing a shortage in skilled labour that’s affecting their ability to take on new work and complete current jobs. While it’s improved slightly from two years ago, it’s still incredibly high.”
The report shows firms are prioritizing prefabrication and modular construction (53 per cent), along with demand-driven supply chain systems (56 per cent) and AI-powered tools (also 53 per cent). Other emerging technologies (drones, robotics, and wearable exoskeletons) are also being explored.
“We’re seeing much more interest in tech adoption compared to where we were even two years ago. However, the sector still has a long way to go to move the needle on productivity,” said Thomson. “Making a commitment to invest in technology is the first step. Delivering returns requires careful integration and only works if you also invest in up-skilling your people to use it effectively.”
