indicatorThe Owl

Construction activity down in January

It’s unclear how deeply the pandemic and oil price war will cut into spending going forward, but we can expect 2020 to be an even slower year than 2019.

By ATB Economics 24 March 2020 1 min read

Despite some uptick in the multi-family residential sector, spending on the construction of buildings* in Alberta was down in January. Adjusting for both inflation and seasonal variation, spending fell by 0.7 per cent in January compared to December. This comes after an almost 13 per cent drop in annual spending last year.

Spending on multi-family units rose by 2.6 per cent in January and was up by 4.8 per cent compared to January 2018. Investment in single-family units contracted by 2.3 per cent in January, but posted strong improvement over the previous January (+16.0 per cent). 

The multi-family sector accounted for about 26 per cent of all investment in building construction in January compared to 34 per cent for the single-family sector.

Non-residential building construction investment slipped by 1.4 per cent in January and was down by 13.9 per cent on a year-over-year basis. Spending was down in the commercial, industrial and government sectors.

Nationally, spending was up by 0.9 per cent in January versus December with improvement seen across all of the major subsectors. Spending fell in six of the ten provinces. Quebec posted the largest gain (+6.0 per cent) and Saskatchewan the biggest decrease (-6.1 per cent).

It’s unclear how deeply the pandemic and oil price war will cut into spending going forward, but we can expect 2020 to be an even slower year than 2019.

*Investment in residential and non-residential building construction represents spending on the construction of buildings by households, enterprises and governments, excluding the value of land.

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A note on COVID-19: The COVID-19 pandemic is having a major impact on the economy here in Alberta and around the world. The Owl will report on these impacts when good information is available while continuing to track regularly scheduled releases of economic data and long-term trends.

For additional information on COVID-19 and advice for the public, please visit World Health Organization or Alberta Health Services. Please go to atb.com for COVID-19-related updates from ATB Financial.

Spending on building construction fell by 0.7 per cent in January compared to December.

Spending fell by 0.7 per cent in January compared to December.


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