Canada’s construction industry continues to weigh heavily on national job numbers, as Statistics Canada’s June payroll report revealed a decline of 32,900 employees across all sectors. The monthly 0.2% drop erased May’s modest gains and highlighted the ongoing pressures facing employers in construction, transportation, and other industries.

On a year-over-year basis, payroll employment remained slightly positive, up 41,000 positions or 0.2% compared with June 2024. However, the data suggests that momentum is slowing, particularly in industries linked to construction and infrastructure.

Construction Sector: A Key Driver of Decline

The construction industry was one of the largest contributors to June’s contraction, with payroll employment falling by 5,200 positions (0.4%). Specialty trade contractors, non-residential building construction, and residential building construction all posted declines, reflecting slower project starts and ongoing cost pressures.

Between December 2024 and June 2025, the sector lost 13,000 payroll positions — a decline of just over 1%. Specialty trade contractors bore the steepest losses, shedding 5,600 jobs, followed by heavy and civil engineering firms (-4,000) and residential builders (-3,900, or 2.3%).

By June, the total number of construction workers receiving pay and benefits stood at 1,176,000.

Broader Employment Trends

In total, 10 of the 20 sectors surveyed by Statistics Canada reported statistically significant job losses in June. Only two sectors recorded gains, with public administration being the sole one with growth large enough to be considered significant.

At the same time, Canada saw an increase in job vacancies, which rose by 12,100 (2.5%) to reach 492,000 in June. The job vacancy rate also edged higher to 2.8%, up from 2.7% in May. Despite this, vacancies were still down more than 10% compared with June 2024.

Construction Job Vacancies Rise Despite Payroll Declines

Interestingly, while payroll employment in construction fell, job vacancies in the sector jumped by 4,600 (13.1%) to 39,500 in June, partially offsetting the 5,400 decline seen in May. This trend suggests employers are still struggling to attract and retain skilled labor, even as payroll figures shrink.

Despite the monthly increase, construction job vacancies remain well below past highs — down nearly 10% compared to June 2024 and less than half of the 89,000 vacancies recorded at the April 2022 peak.

The construction job vacancy rate rose to 3.2% in June 2025, up from 2.9% in May, but down 0.4 percentage points from the same month last year.

Outlook: A Sector at a Crossroads

Economists point out that the construction sector’s dual reality — fewer workers on payrolls but persistent hiring needs — reflects a mix of factors. Rising material costs, project financing challenges, and slowing housing demand are limiting new hires, while retirements and labor shortages continue to create openings.

“Construction has been under pressure for months,” one industry analyst noted. “We’re seeing fewer workers employed, but that doesn’t mean companies don’t need labor — it means they’re constrained in what they can afford.”

With nearly one in three vacant jobs in June coming from construction, the sector’s health will remain a critical factor in shaping Canada’s labor market in the second half of 2025.

Originally reported by Adam Freill in On-Site Magazine.