Building is a relative term — it can mean many things when applied to the economy of Newfoundland and Labrador.
When you see a lot of building or construction — homes, buildings and businesses — that generally tells everyone the province is in good shape, as industry is driving these projects.
But when that tapers off, so does the economy.
Mark Casaletto, president of Construction Market Data – Canada (CMD), was in St. John’s on Friday to address the 50th anniversary conference of the Newfoundland and Labrador Construction Association being held over three days at the Delta Hotel.
Casaletto provided the conference with his insight on the state and economics of the Canadian construction industry, trends and current events affecting the industry, and how digital systems and technology are transforming and changing the way the industry works.
“Newfoundland and Labrador is concerned, as the province is susceptible to big swings in exports and resources,” he said.
“When the global economy is good, this province should do well. The global economy is healthy right now in the United States, Europe and China. Because we export so many of our resources to those places, the prospects in short term are solid.”
In addition, Casaletto said, everyone needs to pay attention to trade agreements.
“We have to pay close attention to the renegotiation of NAFTA (North American Free Trade Agreement).”
He also said the Canada-European Union (EU) Comprehensive Economic and Trade Agreement (CETA) will be just as important, especially to the economy of this province.
This is a progressive trade agreement that upholds and promotes the values that Canada shares with the EU, he said.
“The European agreement is huge. The (construction) association here is very involved in that. That EU market is one of the largest in the world and more trade with Europe is good and this region stands to benefit.
“Industry is cyclical and right now, this province is coming off a cycle that was down. Things are based on private investment, based around resources.”
If there is more trade with Europe, this region stands to benefit from that, but on the flip side, there is potentially increased competition from others trying to get a piece of the pie, Casaletto said.
“The NLCA has to get their membership ready for that.”
Casaletto used the housing industry as an example, saying that when the industry is less busy, so is the housing market, and when things are good, people tend to spend money. He said this industry is also cyclical and there should be an improvement over the next few years.
“Oil and gas, the natural resources, those have slowed down and our industry lags with that.”
He said as oil stabilizes and prices go up, it affects a host of things.
He said even with the Paris Accord and those who signed on looking for more sustainable resources, the long-term prospect for oil is good. Supply is down right now, but the prices are stabilizing and there will be a need for it in the future, in addition to the new sustainable resources that are being developed, he said.