March 2016 – Article: Eye on Infrastructure Spending

Eye on Infrastructure Spending:  The OCS 2016 State of the Industry and Outlook Conference


Infrastructure was a popular topic at the Ontario Construction Secretariat’s 16th Annual State of the Industry and Outlook Conference, held March 8th at the Downtown Hilton in Toronto.  Among the presenters was Craig Wright, RBC Canada Vice President and Chief Economist.  In response to some observations from the discussion, Wright believes the economy and the time is right to act.  Watch his comment here.

The Conference is one of the highlights on the Secretariat’s annual calendar.  This year a record number of 270 people attended the event representing owners, contractors, government, labour groups, apprentices and stakeholders.

While the Confidence Indicator is always greatly anticipated by attendees, much of the discussion at the Conference centered around government [provincial and federal] plans on infrastructure spending.

Wright presented a wide-ranging analysis of economic trends that ranged from oil prices, US growth, and the American and Canadian dollars to the labour market in Canada and the US, the federal deficit, interest rates and the Ontario job market.  He noted in particular that last year was the first year in 10 years the Ontario employment rate was below the Canadian average and the first year in 20 years that it was below the Alberta average.

With regards to infrastructure spending, Craig pointed out that Ottawa used to talk about “shovel ready” projects.  Now it’s referencing “shovel worthy” projects that make economic sense in the long term and provides support for growth in the short term.

Ontario Deputy Premier Deb Matthews, who also serves as President of the Treasury Board, opened the Conference. She told attendees Ontario Government is going to invest $160-billion over the next 12 years in infrastructure spending – the largest infrastructure investment in the history of the Province.

Click here to watch her remarks.

She also explained the Government is tripling the amount of money in the Ontario Community Infrastructure Fund. It contains money that is earmarked for smaller communities to repair bridges and build roads. Minister Matthews says $300-million is now in the Fund which will have a real impact on contractors working in those communities.

The end result the Minister explained, is that such investment by the Province in infrastructure spending will result in creation of an estimated 110-thousand jobs annually.


The Construction Confidence Indicator was presented by the Katherine Jacobs, the Director of Research for the OCS.  Katherine announced the Indicator scored a 57, which means slightly more contractors than not, expect to conduct more business in 2016.

Regionally, the contractors that are most optimistic are those in southwestern Ontario and the GTA, while those contractors in northern Ontario have a modestly pessimistic outlook.

OCS Chief Executive Officer Sean Strickland explained that as commodity prices go, so goes the north.  He explained that lower commodity prices [as they have been trending of late] impacts the mines’ capital expenditures on maintenance and new projects which negatively impacts contractors.

Breaking down the sectors, contractors expect growth in 2016 to be driven by activity in the residential sector, followed by the commercial and institutional sectors.  By region, the greatest expectations for growth in the residential sector are mentioned by contractors in the City of Toronto [33%], other areas of the GTA and Niagara Region [36%].  Expectations for growth in the engineering sector is primarily driven by contractors in the Ottawa [19%] and Niagara [14%] areas, while expectations for growth in the institutional sector is also led by contractors in the Ottawa and Niagara regions [16% and 14% respectively].  A variety of firms from almost all regions expect growth in the commercial sector.

Watch Katherine’s comments with regards to optimism in the institutional sector by clicking here.

The federal government has promised to spend upwards of $125-billion on infrastructure projects across Canada in the next decade.  Ontario is pledging to spend $160-billion over the next 12 years.  Yet only 6% of contractors “expect to benefit greatly” and only 56% “plan to bid on infrastructure projects”.

Strickland says much of the reason is because Government plans for infrastructure spending is short on details.

The Conference concluded with an engaging panel discussion on the topic of “Ontario’s Economy – What Can You Expect”.  It featured Craig Alexander from the C.D. Howe Institute, Livio Di Matteo, Professor at Lakehead University and a Senior Fellow with the Fraser Institute, and Mark Romoff with the Canadian Council for Public-Private Partnerships.

Much of the discussion focused on the upcoming federal budget and the importance of infrastructure as explained by Craig Alexander here.

Planning for the 2017 Conference is already underway.  Hold the date: March 9, 2017. Continue to watch for updates.


To VIEW & DOWNLOAD Presentations, Conference Documents, Video Footage, Sponsor info, from the 2016 State of the Industry & Outlook Conference (SIOC ’16), Go to: Click Here




Katherine Jacobs
Director of Research,


Fred Lehmann
Communications Coordinator,

Ontario Construction Secretariat (OCS)
180 Attwell Drive, Suite 360, Toronto, ON M9W 6A9
P 416.620.5210 ext. 222
F 416.620.5310