Canada market intelligence: an era of uncertainty
Our Q1 2026 Canada market intelligence report provides market and provincial analysis for the region, as well as economic insights from our team of industry experts. This edition also features our 2026 cost guide.
Economic and construction overview
Canada’s economy slowed in 2025. Weaker trade, labour a cooler labour market and heightened geopolitical risks weighed on growth. However, there’s a sense of cautious optimism for the year ahead, even though 2026 began on unsteady foundations.
The construction sector saw broad-based improvement and proved resilient against an increasingly uncertain backdrop.
Public sector work still supports activity, but federal spending and provincial budget cuts are diverging. Some markets now face tough investment trade-offs.
Future escalation as supply chain pressures grow
Input cost growth has begun to reemerge, driven by tariff constraints and supply chain disruptions in 2025. Elevated oil prices remain a risk for the construction industry’s cost base in 2026, although increased labour market slack has helped to contain these pressures for now.
Bid price escalation should remain modest in the near term as subdued workloads promote healthy competition. However, 2027 and 2028 are likely to bring renewed escalation growth and increased capacity constraints as pipelines recover and backlogs fill-out amid growing infrastructure demand.
Modest economic growth expected
Despite a complex political and economic environment, the Canadian economy is forecast to achieve modest GDP economic growth in 2026, 2027 and 2028. Conjecture between federal intent and provincial realities will become more prominent as 2026 unfolds as well.
Several recently released provincial budgets aim to tackle deficits this year, while the federal government reinforces an investment-led approach to growth.
