Sounding an alarm
Ontario Construction News staff writer
The London Home Builders’ Association is warning of deepening job losses and a prolonged slowdown in residential construction, saying urgent government action is needed to prevent further economic damage in the region.
Results from a recent LHBA survey show more than 60 per cent of builder, subtrade and supplier members laid off staff over the past year, with additional layoffs expected in the next six months. Builders rated their confidence in the market at an average of just 3 out of 10, and some reported they have not built a new home since 2023.
The downturn is already reflected in employment figures. Since last September, the construction sector in the London area has lost about 5,800 jobs. The association said that scale of loss, spread across the industry, represents a significant hit to the local economy — comparable to nearly half the workforce at Western University.
Despite the slowdown, builders are attempting to retain workers to prepare for an eventual market rebound. However, the LHBA warns that prolonged inactivity could push skilled workers out of residential construction entirely or into early retirement. With Ontario already expecting about 20 per cent of its construction workforce to retire by 2034 — and only half of those positions projected to be replaced — the association says labour shortages could worsen and further constrain housing supply.
The slowdown is also reshaping the market. Many builders have shifted into renovation work, increasing competition for contractors already facing weaker demand. About 75 per cent of renovators surveyed said clients are scaling back projects due to affordability concerns.
The impact is extending through the supply chain. Local building material suppliers reported revenue declines of up to 60 per cent between 2024 and 2025, with more than half expecting further drops in 2026.
The association says the slowdown could also affect municipal finances in London. With fewer housing starts, the city faces reduced assessment growth and lower development charge revenues; key sources of funding for infrastructure and services.
Beyond the construction sector, the LHBA points to broader economic consequences. Citing data from the Canadian Real Estate Association, it estimates that each unbuilt home represents about $124,200 in lost spinoff economic activity.
The association is calling on all levels of government to act, including eliminating provincial and federal sales taxes on new home construction and reducing municipal development charges. Without changes, it warns, fewer homes will be built — and governments will ultimately collect less revenue.