NL's Construction Outlook: Megaprojects Fuel Growth Amid Labor Shortfall

ST. JOHN'S, NL – July 20, 2026 – Newfoundland and Labrador's construction industry is on the cusp of a profound transformation, defined by a stark divergence in fortunes. A new forecast from BuildForce Canada projects a decade of powerful growth in non-residential construction, fueled by a wave of megaprojects in the energy and public sectors. This boom, however, is set against a contracting residential market and a looming demographic cliff that threatens to leave the province short of thousands of skilled workers needed to turn blueprints into reality.

The report, which covers the period from 2026 to 2035, paints a picture of a two-speed economy. While non-residential investment is set to surge by nearly 25%, residential construction employment is expected to shrink by 10%. This schism presents both a monumental opportunity and a critical strategic challenge for the province's leaders and investors.

The Non-Residential Juggernaut

The engine of the anticipated boom is a slate of massive engineering and institutional projects, collectively representing tens of billions of dollars in new investment. Activity is expected to ramp up significantly, reaching a peak in 2031 as several key projects hit their stride.

At the forefront is the offshore oil sector, where Equinor is advancing the Bay du Nord project. After acquiring full ownership from BP earlier this month, the company is targeting a final investment decision in early 2027 for the estimated $14 billion development, with first oil projected for 2031. This project alone is expected to drive substantial demand for specialized trades and engineering services.

Equally transformative is the planned Churchill River power development. Following a Memorandum of Understanding signed between NL Hydro and Hydro-Québec, a final agreement is anticipated to unlock an estimated $33 billion in construction spending. This includes a new $4.6 billion powerhouse at Churchill Falls, slated to begin construction in 2029 and add 1,100 MW of capacity by 2035, alongside significant upgrades to the existing facility.

Onshore, the industrial, commercial, and institutional (ICI) building sector is also poised for major growth, with employment projected to rise by 27%. Ground has already been broken on a new $698.2 million adult corrections facility in St. John's, with a completion date in 2029. Concurrently, work is scheduled to begin this year on a new net-zero carbon National Verification and Collection Centre for the Canada Revenue Agency, a project that underscores a federal commitment to modernizing infrastructure in the region.

“There is good reason to be optimistic about the long-term outlook for non-residential construction in Newfoundland and Labrador,” says Terry French, President of the Construction Labour Relations Association of Newfoundland and Labrador. “While activity is slower in the short term, the potential for major projects on the horizon and a labour force ready to respond position the industry well for future growth.”

A Tale of Two Sectors

While the non-residential sector prepares for a surge, the outlook for housing construction is more subdued. The report forecasts a 10% decline in residential construction employment by 2035 compared to 2025 levels. This slowdown is primarily attributed to an expected easing of population growth following recent highs, which will temper demand for new single-detached and multi-unit homes.

The greatest impact will be felt in the new-housing segment. However, the report identifies a crucial stabilizing force: the residential renovation market. As the province's housing stock ages, demand for maintenance, retrofits, and upgrades is expected to rise steadily throughout the decade, providing a consistent stream of work for a segment of the residential workforce.

This divergence creates a complex operational challenge: how to manage a potential surplus of labor in one sector while facing a critical shortage in another. The skills required for large-scale industrial projects are not always directly transferable from residential construction, necessitating strategic planning for retraining and workforce mobility.

The 5,700-Worker Question

The most significant hurdle to realizing the province's construction potential is demographic. The industry faces an unprecedented wave of retirements, with an estimated 5,900 workers—a staggering 30% of the 2025 labour force—expected to hang up their hard hats by 2035. When combined with the new positions created by non-residential growth, the total hiring requirement climbs to 5,700 workers.

“Although there is a risk that slowing population growth may lead to labour surpluses in the province’s residential construction sector, the outlook for non-residential construction activity in Newfoundland and Labrador calls for strong growth,” says Irwin Bess, Executive Director of BuildForce Canada.

Even with an anticipated 4,100 new entrants under the age of 30 joining from the local population, the industry is projected to face a structural deficit of 1,600 workers. This gap cannot be filled from traditional sources alone. Local industry leaders acknowledge the challenge, tempering their enthusiasm with a dose of reality.

“While Newfoundland and Labrador’s work picture outlook is reasonably bright, we should move forward with cautious optimism as many of the projections rely on projects that have not yet been approved for final investment,” notes Bob Fiander, Executive Director of Trades NL, alluding to the critical FID for Bay du Nord. He points out the current paradox of having skilled tradespeople unemployed today while facing a massive shortage tomorrow, emphasizing the need for projects to get “shovels in the ground” to bridge that gap.

Building a New Workforce

Addressing the 1,600-worker shortfall will require a concerted and innovative recruitment effort. The industry is increasingly looking to groups traditionally under-represented in the trades to build a more diverse and resilient workforce.

Women represent a significant, largely untapped talent pool. In 2025, they made up just 3% of the 15,600 tradespeople employed in the province's construction industry. While 2,290 women were employed in the sector overall, only 21% of them worked directly on construction sites. Closing this gender gap is a key strategic priority.

The province’s growing Indigenous population offers another vital recruitment opportunity. Indigenous Peoples already represent 8.4% of the construction labour force, a share that has increased from 6.7% in 2016 and slightly exceeds their representation in the overall provincial workforce. Initiatives like the mandatory Indigenous Participation Plans for federal projects are designed to strengthen this trend.

Furthermore, with the province expected to welcome nearly 51,200 immigrants between 2026 and 2035, newcomers are seen as a critical component of the future workforce. Integrating these new Canadians into the construction sector will be essential for meeting demand.

Success hinges not just on recruitment, but on training. While new registrations in construction trade programs have rebounded to pre-pandemic levels, with nearly 600 new registrants in 2024, the report notes that completions have been slower to recover. Ensuring these students complete their apprenticeships and enter the workforce is crucial for building a sustainable talent pipeline to power the province through its next decade of growth.