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Engineering & Construction
5 Trends to Watch in Alberta Engineering & Construction Industries
Today, in 2017, Alberta's engineering and construction industries are being influenced by a number of factors and trends. These trends have gone a long way to shape this particular industry, and some are expected to trickle down to 2018.
Notably, the low oil prices have negatively affected business capital investments, and it has slowed down the industry's growth. Many construction workers have resolved to look for job opportunities in Alberta and beyond. That said; the engineering and construction industry in Alberta expects to see:
• High unemployment rates
• Slower growth
• Dependence on the local workforce
• A lot of job losses
1. Drop in the oil prices
The low oil prices have affected a lot, including the development plans in the non-residential sector. These rates have resulted in both delays and cancellation of small business financing, which has led to numerous job losses in the non-residential engineering sector alike. The trends indicate that business premises will see a decline as compared to previous years because the rate of vacant offices will increase. This will also result in lower revenues for the Alberta government.
Five years from now, it is anticipated that the oil moguls will continue to dictate the spending rate in Alberta. If the oil prices continue to stay low, this means that there will be limited business capital, and the engineering sector will face a decline.
How so? There will be slower road and highway construction, which will see many employees in the engineering sector lose their jobs.
Engineering works in the non-residential sector will mostly hail from maintenance. With low oil prices, some companies will have access to cheap transportation, but the engineers who work directly in the oil industry, plus those who work in businesses that administer to the oil industry should expect to see a decline in their profits.
2. Dependence on the local workforce
In previous years, Alberta's construction industry mostly relied on out-of-province employees to cover the high demand for employment. Currently, however, the low oil prices have seen a decline in employment opportunities, which has led to the repatriation of this workforce. Compared to the last decade, the rate of unemployment is expected to plummet. The fall will in turn influence the trends in recruitment. The construction industry will mostly rely on the local workforce. It will also affect how the engineering industry will meet its needs in the future.
There are of course some skilled workers in the local market, who can be recruited to cater for the increasing demand. Sourcing employees from the local market, however, is challenging because the industry may be constrained by the short-term increase in demand and large projects. In case this happens, the employers within the construction industry may need to compete to bring in more workforce that is needed to meet the rise in demand. Another challenge here is that the skillset required by employers for certain projects may not be available in the local market, and this may lead to the cancellation or extension of deadlines for some projects.
3. New Technologies
Another trend that is anticipated in the engineering sector in Alberta is new technologies. The technology that is being adopted in the engineering and construction industry cannot be compared to that which was being utilized a decade ago. Artificial intelligence is not only being utilized in these operations but is now affordable. New technologies also include employing automated processes. The engineering sector is slowly moving towards the future. Modern engineers are even more innovative in ways that ensure construction works in Alberta are seamless.
Small business financing is also available to startup companies that deal with technologies that go towards improving the operations in the construction industry. Technological innovations are now a reality and not just things that you catch in a Sci-Fi movie. These technologies are now part and parcel of the operations, and they can be used in the construction of roads, highways, and bridges. With the advancements in technology, engineers in the oil industry are now able to adopt better waste disposal methods, and they can improve the quality and achieve sustainability.
4. Recovery in new housing activities
The Alberta housing market was significantly weak in 2015 and 2016. In 2017, however, renovation activities are evident in the residential sector, and the market is slowly stabilizing. A recovery in new housing is anticipated in 2018, while in 2019, an increase in new housing is expected. This is because the forecast indicates that the economy is slowly recovering, a recovery that will bring about new projects that will, in turn, bring forth new employment opportunities.
This, however, does not imply that the construction sector is safe. Stakeholders in the industry have to assess various risk factors first before making such an assumption. For instance, the industry will require a lot of new workers, who have to be skilled to replace the retirees. Therefore, employers in the construction sector have to put in efforts to train the modern workforce and to recruit back some of the employees laid off during the economic downturn.
5. Alberta’s construction workforce anticipated to grow
The increase of major projects in Alberta and its surroundings is expected to bring about an increase in the workforce. So far, there are proposals to construct a pipeline, transportation, highway, and bridge projects, and these will see a significant increase in Alberta's labor market. The proposed projects are quite vast, and employers will require an adequate workforce to meet the demand. If the economy continues to stabilize, as is anticipated, employers in the construction sector may find it necessary to outsource workers from out-of-province. What's more, the industry expects to retire a considerable number of employees over the next decade, and as such, they have to seek for new and skilled workers to cover for them. The construction industry in Alberta mostly comprises of men, but it is looking forward to recruiting more women, not forgetting indigenous people to cater for the required skill set.
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