Is The Worst Over? newsletter. May to 3 4 to 6 8 to 9 10

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Charlene Goodman
5 years ago
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Depression, with the United Kingdom, France and Italy also showing signs that the economic slide is bottoming out.

In addition to less bad indicators, a number of positive indicators are starting to emerge. Although, the economy continued to shrink in February, the rate of decline is easing.

1 May 2009 newsletter Photo: Janis Rees Is The Worst Over? he Canadian economy remains in the grip of strong slowdown despite the first baby steps of growth appearing in other parts of the world. According to a new report from the Organization for Economic Co-operation and Development, China is leading the world in a potential rebound from the world s most severe slump since the Great Depression, with the United Kingdom, France and Italy also showing signs that the economic slide is bottoming out. Canada s economy will likely remain in recession for most of this year with real GDP expected to contract 2% in However, many economists think the worst behind us. In addition to less bad indicators, a number of positive indicators are starting to emerge. Although, the economy continued to shrink in February, the rate of decline is easing. Even with this easing, the first quarter contraction will be one of the largest quarterly declines on record. Source: RBC,TD,CBIC,BMO,Scotia Bank,C4SE It is not expected that Canada, and Ontario, will see any positive growth until the fourth quarter of this year when the fiscal and monetary stimulus, combined with steadier commodity prices and an upturn in U.S. demand, start to kick in. Ontario s economy will see a significant boost from $33 billion of infrastructure spending over two years, about 6% of the province s GDP. However, the recovery will be held back by soft exports to a restrained U.S. consumer. As an exporting province and nation, our recovery is largely dependent on the recovery of our trading partners. Despite the fact that the Canadian economy likely produced the worst quarterly contraction Continued on page 2 Inside this issue: SURVEY RESULTS: Ontario Contractors Outlook Cautious for 2009,..... RECAP: Future Building RECAP: 2009 OCS Government Reception Upcoming Events. 1 to 3 4 to 6 8 to 9 10 OCS EYE ON ICI - May

2 OCS EYE ON ICI Continued from Page 1 Ontario s construction industry lost 6,000 jobs in April and a total of 37,000 jobs since last November when construction employment hit an all time peak of close to 450,000 workers. Most of the job losses can be attributed to significant declines in residential construction activity. First quarter residential permits are down by $1.1 billion from 2008, whereas ICI the value of ICI permits remained constant. There is growing optimism that the worst is behind us. However the recovery will be slow and the economy of tomorrow will look and feel different then the pre-crisis economy. on record in the first quarter of 2009, it managed to add 36,000 jobs in April. This unexpected jump follows five months of massive job losses with a total of 321,000 losses since October. The national unemployment rate remained at a seven year high of 8.0% in April, up 2.2 percentage points from its low in the beginning of Ontario lost 3,000 jobs in April, but managed to hold its unemployment rate at 8.7%. Of course the devil is in the details; the rise in employment was largely the result of a 37,000 jump in self employed workers. It is probable that a large portion of these self-employed workers are those who were laid off and forced into self-employment, a trend that was also noticeable during the 1990 s recession. The rise in employment was also focused in the 55 and up age group, as more retirees re-entered the job market, likely the result of deteriorating wealth related to the stock market correction. Canadian Economy at a Glance Latest Month % Change from Previous Year Month Ago 3 Month Trend Real GDP Feb Down Industrial production Feb Down Employment Apr Down Unemployment rate Apr. 8 8 Up Manufacturing Production Feb Down Employment Apr Down Shipments Feb Down New orders Feb Down Inventories Feb Up Retail sales Feb Down Car sales Feb Down Housing starts (000s)* Apr Down Exports Mar Down Imports Mar Down Trade balance ($billlions)* Mar Down Consumer prices Mar Down *Levels are shown for latest period and the same period a year earlier Source: RBC Economics, May OCS EYE ON ICI - May 2009

3 OCS EYE ON ICI Ontario Building Permits Update Total Value of ICI Building Permits Issued in $ Billion's the First Quarter Ontario 3 $2.6 $2.5 $ $1.5 $1.8 $ Source: Statistics Canada, Building Permits, OCS strong surge in non-residential building intentions in the month of March helped propel the value of first quarter ICI permits to just over $2.4 billion dollars, almost dead even over the same period in On a quarter over quarter basis, the first quarter of 2009 also marked a 15 per cent rebound over the last quarter of 2008, in which permits plunged 38 per cent. The rebound was predominantly supported by strength in the GTA s commercial sector and institutional building intentions in the Central and Eastern regions in the province. Industrial permits totalled $284 million dollars over the first three months of this year, a 24 per cent decrease over the same period last year. Industrial building intentions were actually up in three out of the five regions in the province, but declines in the GTA and Central Ontario, of 46 percent and 24 percent respectively, outweighed the increases recorded in the reset of the province. The dismal economic climate continues to pummel the manufacturing sector, contributing to continued weakness in building intentions within the factories segment, which was off 45 per cent compared to the first quarter of The value of institutional permits issued in the first quarter of the year totalled $807 million, down 11 percent over the same period a year ago. The most significant decreases were witnessed in the Southwestern and Northern regions of the province, where permits were down 71 per cent and 57 per cent respectively. However, the decline was due in part to a number of large hospital projects which got under way in the early part of Institutional building was active outside the hospital building segment. The Niagara Convention and Civic Centre and Ottawa Convention Centre both broke ground in recent months propelling the value of first quarter building intentions in the government buildings segment up 44 per cent over Q1 of Institutional activity should accelerate in the latter part of this year as infrastructure projects under the infrastructure stimulus fund role out and a number of already planned hospital projects begin construction, including the $760 million Niagara Health System health-care complex which broke ground earlier this month. A 25 per cent increase in the value of commercial building intentions in the GTA boosted Ontario commercial permits to $807 million, a 15 percent increase over the first quarter of Commercial permits were primarily driven by continued strength in the value of office permits and recreational building, which was bolstered by commencement of work on the conversion of the Brantford Charity Casino. Looking forward, building intentions in the retail segment, which are already down 32 per cent compared to the same period last year, are expected to continue to soften due to the current economic climate. This combined with millions of square feet of additional office supply coming on stream in and around the GTA will most likely result in an overall decline in commercial sector building activity in % 20.0% 10.0% 0.0% 10.0% 20.0% 30.0% 40.0% 50.0% Ontario ICI Building Permits Quarter over Quarter Change 23.4% 17.7% 10.6% 8.7% 38.2% 08 Q1 08 Q2 08 Q3 08 Q4 09 Q1 OCS EYE ON ICI - May

OCS EYE ON ICI Ontario Regional Permits NORTHERN ONTARIO In Northern Ontario first quarter non-residential permits totalled $61 million, down 41 percent compared to the same period last year.

Despite the decrease in permit values construction activity remains buoyant thanks to continued work on a number of large hospital projects, including the new $409 million Sault Area Hospital, which

EASTERN ONTARIO Non-residential permits in Eastern Ontario valued $289 million over the first 3 months of the year, up 46 percent compared to Q1 of 2008.

4 OCS EYE ON ICI Ontario Regional Permits NORTHERN ONTARIO In Northern Ontario first quarter non-residential permits totalled $61 million, down 41 percent compared to the same period last year. The decrease was attributed to declines in the value of institutional and commercial permits which were down 57 percent and 35 percent respectively. Despite the decrease in permit values construction activity remains buoyant thanks to continued work on a number of large hospital projects, including the new $409 million Sault Area Hospital, which is set to open in Northern Ontario also has an unprecedented amount of road work on the books, which will only be accelerated by the federal government s infrastructure stimulus package. EASTERN ONTARIO Non-residential permits in Eastern Ontario valued $289 million over the first 3 months of the year, up 46 percent compared to Q1 of University construction at Queens University, Algonquin College and Carlton University contributed to a rebound in institutional permits of $130 million. Building activity in the institutional sector was also supported by an acceleration of work on the new Ottawa Congress Centre. Increased activity in the institutional sector was offset by a decline in commercial sector, in which permits totalled $108 million, one quarter less than the same period in Industrial permits were up 120 percent compared to the same period a year ago, however, the sector is relatively small in region and is susceptible to swings in permit values. Northern Ontario Sector Value (000 s) %Change Industrial $10, % Commercial $27, % Institutional $23, % Total ICI $61, % Source: StatsCan Eastern Ontario Sector Value (000 s) % Change Industrial $50, % Commercial $107, % Institutional $130, % Total ICI $289, % Source: StatsCan CENTRAL ONTARIO Building activity has been quite active in Central Ontario over the first three months of the year. Led by a 43 per cent increase in institutional, and a 10 percent increase in commercial building intentions, Central Ontario ICI permits totalled $687 million in Q1 of 2009, an increase of 20 per cent over last year. The value of permits in the industrial sector decreased by 24 per cent, to just under $70 million. In the Niagara region, permit values were down about 18 per cent compared to last year. However, the value of building intentions should increase in the coming months as work shifts into high-gear on the $760 million Niagara Health System health-care complex and Walker Family Cancer Centre, and the $100 million Niagara Convention and Civic Centre. Both projects broke ground earlier this month. Barrie should also witness a spike in the institutional sector as work begins on the $258 million Expansion of Royal Victoria Hospital. Construction of the new addition and cancer centre is expected to be completed in fall 2011 Central Ontario Sector Value (000 s) % Change Industrial $69, % Commercial $243, % Institutional $374, % Total ICI $687, % Source: StatsCan 4 OCS EYE ON ICI - May 2009

Ontario Building Permits Update OCS EYE ON ICI GTA ONTARIO Although, down slightly from a record first quarter in 2008, the value of first quarter building intentions in the GTA surpassed $1.

Continued strength in the office building segment pushed up the value of commercial permits to $873 million, a 25 percent increase over the same period a year ago.

5 Ontario Building Permits Update OCS EYE ON ICI GTA ONTARIO Although, down slightly from a record first quarter in 2008, the value of first quarter building intentions in the GTA surpassed $1.2 billion for the third consecutive year. Continued strength in the office building segment pushed up the value of commercial permits to $873 million, a 25 percent increase over the same period a year ago. The commercial market continues to dominant in the GTA with building intentions in the sector making up 71 percent of the total value of nonresidential permits issued in the first quarter. Both industrial and institutional permits decreased by 46 percent and 38 percent respectively over the same period in As many tower projects in the GTA are nearing substantial completion, the commercial sector may have reached its peak. Four new office buildings are scheduled to be completed over the course of 2009 including the Bay Adelaide Centre, Telus Tower, Maple Leaf Square and the RBC Centre. Once completed, these towers will not only alter Toronto s skyline, but also add millions of square feet to Toronto s office supply and increase vacancy rates in The combination of new office supply and softening demand given the current economic climate will most likely lead to a decline in commercial sector activity in 2009 and into GTA Ontario Sector Value (000 s) %Change Industrial $125, % Commercial $873, % Institutional $217, % Total ICI $1,216, % Source: StatsCan SOUTHWESTERN ONTARIO Although up 38 percent from the same period last year, the value of industrial permits in Southwestern Ontario is only about half the first quarter average recorded for the previous eight years. Commercial permits on the other hand recorded their strongest first quarter this decade, totalling $93 million, they were up 49 percent over last year. In the institutional sector permits were down 71 percent compared to the strong start recorded in However, despite the slow start, the institutional sector is poised for growth this year as a significant number of large projects are scheduled to start in the coming months. The Windsor Regional Hospital is planning to embark on a three-year $100 million renovation of its Western campus and a $50 million expansion at its Metropolitan campus. Also, a number of public and elementary school projects are slated for 2009 in the regions of Windsor and London, including: the Ecole Secondaire de Windsor and Dr. David Suzuki Public School in Windsor. Both projects are aiming for LEED designation. Finally, the long anticipated $1.6 billion Windsor-Essex Parkway mega project may finally begin towards the end of the year. The new international crossing over the Detroit River to Interstate 75 will include a six-lane highway, 11 kilometres long with 11 tunnels and a four-lane service road. Southwestern Ontario Sector Value (000 s) % Change Industrial $29, % Commercial $93, % Institutional $61, % Total ICI $184, % Source: StatsCan OCS EYE ON ICI - May

rganized workers and employers understand that sustained prosperity in a strong Ontario requires skilled professionals

This is the philosophy behind the annual Future Building show.

possibilities at Future Building 2009. The three-day event (April 7 9 at the Garnet B.

with Employment Ontario, and supported by local construction trades.

6 rganized workers and employers understand that sustained prosperity in a strong Ontario requires skilled professionals committed to superior workmanship now and for generations to come. This is the philosophy behind the annual Future Building show. For the sixth consecutive year, over 7,000 students stepped out of their classrooms and into an arena filled with possibilities at Future Building The three-day event (April 7 9 at the Garnet B. Rickard Recreation Complex in Clarington, Ontario) was presented by the Ontario Construction Secretariat, in partnership with Employment Ontario, and supported by local construction trades. "We welcome every opportunity to represent the construction trades," says Sean Strickland, CEO of the Ontario Construction Secretariat. "It's important to show students, educators and career seekers the tremendous opportunities to be realized in the unionized construction sector. Strickland also emphasized the importance of conveying current and accurate information to educators about apprenticeships and trades so they can pass this information onto qualified students. The truth is educators typically don't know enough about apprenticeships and trades to show their qualified students how best to prepare for such a broad spectrum of career paths" he says. Future Building provides a forum for trainers, apprenticeship coordinators and government facilitators to convey accurate information about construction careers. 6 OCS EYE ON ICI - May 2009

Over the three day exhibition organizers and exhibitors sparked the

discussion and hands-on displays as they brought a multitude of

"Sometimes it's simply a matter of taking the mystery out of the

Cochran, Business Manager for UA Local 463.

and in many other trades, understanding advanced math principles

" I love being a tradesperson and Future Building provides an

7 Over the three day exhibition organizers and exhibitors sparked the imaginations of thousands of attendees through interaction, discussion and hands-on displays as they brought a multitude of rewarding careers to life. "Sometimes it's simply a matter of taking the mystery out of the trades to really grab the attention of the students" says Garth Cochran, Business Manager for UA Local 463. Inevitably someone asks Cochran, when am I ever going to need this kind of math? Cochran tells the students that in the plumbing and piping trade, and in many other trades, understanding advanced math principles will keep the equipment running smoothly and the project progressing safely. Cochran emphasizes this is not a career for struggling students." I love being a tradesperson and Future Building provides an opportunity to convey my enthusiasm for the trades to the next generation. Garth Cochran, Business Manager UA Local 463 Find out more online at Close to 7000 youth, teachers, councilors and parents participated in Future Building 2009 OCS EYE ON ICI - May

Government Reception held on Wednesday April the 22 nd was a great success!

to government officials, provincial ministers, and a variety of key senior

approval of infrastructure construction projects.

steadfast commitment to training and apprenticeship.

Minister of Training Colleges and Universities each addressed the

initiatives, including the Impact of the Underground Economy It Costs Us

8 Queen s Park ( ) he Ontario Construction Secretariat is pleased to report that the Government Reception held on Wednesday April the 22 nd was a great success! This year s reception presented a timely opportunity to deliver a message to government officials, provincial ministers, and a variety of key senior bureaucrats and MPPs to advance infrastructure funding and expedite the approval of infrastructure construction projects. The evening also provided the opportunity to demonstrate our industry s steadfast commitment to training and apprenticeship. Honourable Peter Fonseca, Minister of Labour, and Honourable John Milloy, Minister of Training Colleges and Universities each addressed the assembled guests giving praise to our many highly regarded research initiatives, including the Impact of the Underground Economy It Costs Us All and Building on a Foundation of Investment in Construction Trades Apprenticeship and Skills Training, as well as our effective outreach activities including Future Building. 8 OCS EYE ON ICI - May 2009

They congratulated the OCS for truly adding value to the benefit of both the organized construction industry and its relationship with the

Throughout the evening guests engaged in dialogue with a number of industry and OCS representatives and spent time considering the three display

Sean Strickland, CEO, thanked the government and all MPPs for their unprecedented investment in infrastructure and emphasized that the OCS, through

effectiveness of infrastructure stimulus and help get infrastructure programs out of the ground today.

and absorption of new apprentices during this economic downturn.

facilities and spends on average $37 million per year on training programs.

9 They congratulated the OCS for truly adding value to the benefit of both the organized construction industry and its relationship with the provincial government. Conservative MPP John O Toole and NDP leader MPP Andrea Horwath also took the opportunity to say a few spirited words. Throughout the evening guests engaged in dialogue with a number of industry and OCS representatives and spent time considering the three display stations set up around the room. Large plasma screens conveyed information about the work of the OCS and the importance of the construction industry. Sean Strickland, CEO, thanked the government and all MPPs for their unprecedented investment in infrastructure and emphasized that the OCS, through its research capacity and industry partnerships, is positioned to help government overcome obstacles and identify opportunities to maximize the effectiveness of infrastructure stimulus and help get infrastructure programs out of the ground today. He further noted the efficient implementation of infrastructure investment will greatly assist in sustaining the existing pool of skilled workers and absorption of new apprentices during this economic downturn. Finally, Strickland noted that Ontario s unionized construction industry has invested $200 million in training facilities and equipment in over 65 facilities and spends on average $37 million per year on training programs. Our commitment to training is unprecedented and we appreciate the government s investment in union/employer training centres through the Ontario Skills Training Enhancement program. The OCS and its industry stakeholders look forward to sustaining a strong relationship with our government partners. OCS Photos: Janis Rees (Kaleidoscope Photography) OCS EYE ON ICI - May

10 OUR FOCUS: Owners, Unions and Contractors working together to deliver high quality construction projects safely, on time, on budget. JULY 26-28, 2009 DEERHURST RESORT FOR INFORMATION ON REGISTRATION: For any enquiries related to the Eye on ICI newsletter or to inquire about content submissions please contact Adam Cywinski at the OCS at: Address: 940 The East Mall, Suite 120 Etobicoke, ON, M9B 6J7 Phone: Fax: Web: newsletter 10 OCS EYE ON ICI - May 2009

The Peterborough Census Metropolitan Area (CMA) spans the city of Peterborough and six other jurisdictions. The area is

PETERBOROUGH CENSUS METROPOLITAN AREA Presented by the Credit Unions of Ontario and the Ontario Chamber of Commerce 1 Peterborough s housing market saw a banner year in 2015. The Peterborough Census Metropolitan