The methodology used by the Construction Sector Council to provide forecasts for the construction-related trades uses models of the economy and the demand for trades. The trade demand models use the outputs of the economic models, namely, investment and employment forecasts, along with sets of coefficients that extract the trades’ requirements from the latter forecasts.
The goal is to provide forecasts of the demand for trades by all sectors of the economy, including the construction industry and other industries that employ the trades. In the construction industry, the focus of analysis includes not only trades required for major projects, but for all of the work undertaken by the construction industry. In addition to major projects, the work also includes that for smaller announced and unannounced projects, as well as for maintenance and repair construction activities.
The construction industry separates the demand for the trades among the different types of construction activities to reflect the differing requirements across four different types of construction activities:
- residential construction, excluding apartments five storeys and over
- apartments five storeys and over plus government, institutional and commercial construction
- industrial construction plus the installation of production machinery and equipment
- engineering construction
More specifically, the LMI forecast system links employment in each trade and occupation to spending by specific building types. Each link is defined by a measure of labour required for each million dollars of building. Labour demand is the result of increased economic activity and retirements. The first source of job openings, referred to as expansion demand, relates to the new jobs created when the economy grows. A second source of job openings results when workers leave, usually from retirement. The latter is called replacement demand.
An important part of the trades demand forecasting methodology is the consideration of major projects. These projects are important because they have a significant impact on the economic forecasts and usually have trades requirements coefficients that differ noticeably from the averages used for the four construction categories described above.
While information on major projects assists with the preparation of economic forecasts, they far from cover the entire amount of investment in an economy. It is still necessary to provide forecasts for major projects that are not announced, smaller projects, and maintenance and repair expenditures. The economic models produce such forecasts while incorporating the major project information that is available.
On the supply side, the LMI forecast system tracks labour force, apprenticeship and mobility for selected trades and occupations. Estimates are based on the Statistics Canada 2001 Census as well as input from the industry. The number of potential new job seekers is estimated from the flows of apprentices coming out every year, recent immigrants and people re-entering the job market after a period of non-participation.
