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Investment in building construction plummeted in April

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Investment in building construction, seasonally adjusted.

Investment in building construction plunged 45.9 per cent to $8.4 billion in April compared with the previous month. The largest national decline on record, which dates back to 2010, was a 3.9 per cent decrease in August 2017, reports Statistics Canada.

Both residential and non-residential sectors reported record declines. Investment decreased in all provinces and territories, with Ontario and Quebec reporting the largest declines – down $3.2 billion and down $2.5 billion, respectively.

Public health measures in place to slow the spread of COVID-19 severely impacted the construction industry in April as the largest provinces in the country shut down all non-essential construction sites.

On a constant dollar basis, investment in building construction decreased 45.7 per cent to $6.9 billion.

All provinces and territories reported double-digit declines in residential investment for the month of April, with Quebec and Ontario again reporting the largest declines. In Quebec, all non-essential renovation construction was halted in accordance with public health requirements.

Declines in the residential sector varied by province, however at a national level, the declines were felt more sharply in single-family homes than in multi-family dwellings.

Residential renovations largely ground to a halt across the country, with the exception of certain activities such as emergency and exterior repairs, as many projects were cancelled or deferred to comply with public health requirements.

New residential construction was able to progress across most of the country in April. Excluding Quebec, new residential construction increased 11.7 per cent on an unadjusted basis compared with April 2019, as construction firms adapted to public health requirements such as improved on-site sanitation, physical distancing, and staggered work schedules.

Non-residential investment

Investment in the non-residential sector plummeted 38.8 per cent to $3 billion in April. During this time, non-residential construction was largely shut down in Ontario and Quebec, while other provinces and territories allowed work to continue with strict public health measures in place.

As a result, five provinces – including Manitoba, Saskatchewan, and British Columbia – all posted modest gains for the sector. British Columbia’s increase in April followed five consecutive monthly declines.

The commercial component posted the largest decline – down 49.4 per cent – with notable decreases in Ontario and Quebec. Saskatchewan, Nova Scotia, and British Columbia were the only provinces that posted gains for this component.

Institutional construction tumbled 22.2 per cent with the largest decline in Quebec (down $193.4 million). Conversely, modest gains were reported in British Columbia.

The industrial component decreased by 25.3 per cent to $664.4 million. Quebec and Ontario contributed the most to the decline, while four provinces reported small gains.

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