Canada’s construction sector is stepping up its tech adoption, but procurement reform is key to boosting productivity
A new report from KPMG in Canada, in partnership with the Canadian Construction Association, finds that Canada’s construction industry is making real progress in adopting digital tools to boost productivity — but deeper change is still needed.
About 90 per cent of industry leaders agree that technology is essential to meeting rising demand, and 81 per cent are already seeing improvements from recent tech investments. Tools like building information modelling (BIM), AI, robotics, drones, and prefabrication are helping companies reduce delays, improve efficiency, and address ongoing labour shortages.
Yet even as companies invest, many face pressure on profit margins from inflation, trade disruptions, and outdated procurement systems. Nearly eight in 10 (78 per cent) say procurement processes are evolving to support innovation — a positive sign — but only 43 per cent feel that clients are influencing their decision to adopt technologies.
Procurement still too often prioritizes lowest cost over long-term value, which discourages investment in innovation. Canada’s construction sector is ready to build more, faster, but governments need to reform procurement to foster collaboration, ensure fair risk-sharing, and create the confidence companies need to invest and grow.
Labour is another hurdle. With retirements outpacing recruitment and 70 per cent of leaders expecting it will become harder to meet demand in the next decade, technology alone won’t solve the problem. Companies must also invest in training and upskilling workers to ensure digital tools deliver real productivity gains.
There is also growing momentum behind prefabrication and modular construction, which 53 per cent of firms cite as a top priority and another 27 per cent as a mid-level priority. These methods streamline builds, reduce waste, and can help accelerate timelines – key advantages as demand continues to climb.
Finally, 84 per cent of leaders want interprovincial trade barriers eliminated. The challenges of working under 14 sets of rules and regulations is an unnecessary drag on productivity if the industry is expected to be able to handle the growing volume of projects in the pipeline.
The path forward
The sector is moving in the right direction. Investment in technology is up, and labour productivity and efficiency are improving as a result. There is also a growing appetite for innovation across the board.
But unlocking the industry’s full potential will take more than tools alone. As the national voice of the construction industry, CCA is actively championing the policy changes needed to drive progress, including:
- Procurement reform that rewards long-term value and innovation over lowest-cost bids
- Policy certainty that gives businesses the confidence to invest in new technologies
- Workforce strategies to recruit, train, and upskill talent
- Removal of interprovincial trade barriers to speed up projects
These measures will help Canada’s construction sector to build smarter, faster, and more sustainably.
Related content
Canada’s construction industry gets serious about investing in technology as pressure mounts to do more with less, Joint KPMG in Canada and CCA press release, June 18, 2025