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www.mcac.ca
A
fter a year marked by tariff disputes, 
trade barriers and financial strain, 
stakeholders across construction 
and allied industries are asking the same 
question: what comes next for Canada’s 
economy? While current projections offer 
no crystal-clear forecast for mechanical 
contractors, there is reason for  
cautious optimism.
“I think the economy has continued to 
surprise people in terms of its resiliency 
over this last year, considering how 
much uncertainty there was,” says Ken 
Lancastle, chief operating officer of the 
Mechanical Contractors Association of 
Canada (MCAC).
That resilience does not mean immunity. 
While an uptick in economic indicators 
is encouraging, the near-term landscape 
remains shaped by uncertainty. Rising 
costs, persistent labour constraints and 
industry-specific pressures – such as the 
collapse of high-rise development activity 
in the Greater Toronto Area – continue to 
weigh on overall industry confidence.
It’s a mixed bag, to say the least. And 
though today’s unpredictability makes 
the economy difficult to read, veteran 
economists such as Alex Carrick of 
Construct Canada offer a measured 
assessment. “The economy isn’t doing as 
badly as people thought it was going to 
do,” he says. That is, while unpredictable 
policy moves from the United States are 
not helping Canada’s prospects,  
Carrick argues that the construction  
sector – including mechanical  
contracting – stands at the doorstep  
of “enormous opportunity.”
A 10,000-Foot View
Understanding what lies ahead for the 
mechanical contracting trade begins 
with a macro-level view of the Canadian 
economy. According to the Bank of 
Canada’s latest outlook, economic growth 
is expected to strengthen in 2025 and 
remain modest but steady thereafter, 
with real GDP growth projected at 
approximately 1.8 per cent in both 
2025 and 2026. Inflation, meanwhile, is 
projected to remain near the bank’s two-
per-cent target for the near future.
The labour market is expected to remain 
more balanced than the exceptionally 
tight conditions seen in recent years, 
with some softening expected through 
2026. For most industries, including 
mechanical contracting, this suggests a 
period without extreme wage escalation or 
across-the-board labour shortages, though 
competition for certain specialized skills, 
and in specific regions, will persist.
A Lens on Economic Drivers
A closer look at what is driving economic 
activity reveals a more optimistic picture 
for construction trades, and at the 
centre is Canada’s broad infrastructure 
push. Under its Canada Strong rallying 
cry, Canadian governments have 
committed more than $115 billion in 
direct infrastructure spending over five 
years, alongside a broader capital plan 
approaching $280 billion. 
This funding is driving a broad range of 
long-duration projects across the country, 
from modular nuclear plants in Ontario 
to massive energy transmission line 
upgrades in B.C. These projects are less 
vulnerable to short-term economic swings 
and require skilled mechanical trades  
at scale.
CANADIAN ECONOMIC OUTLOOK
MATTHEW BRADFORD
Implications for mechanical contractors

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