Faced with growing pressure to build faster and more efficiently, Canadian construction leaders are embracing digital tools to boost productivity, according to a new report from KPMG in Canada.
The biennial survey found that nine in 10 industry leaders agree advanced technology is key to addressing challenges in the sector, including labour shortages and sluggish productivity. Roughly 81 per cent of construction firms say recent investments in technology are already improving efficiency on job sites.
“It is good to see the sector investing in the technologies that are desperately needed to address persistently poor productivity levels,” said Tom Rothfischer, partner and national industry leader for building, construction and real estate at KPMG. “These investments are about to pay dividends and transform how we build in Canada.”
The report comes as governments and industry attempt to tackle the country’s housing shortage and deliver on infrastructure megaprojects. But Rothfischer warns economic pressures could threaten progress, as shrinking profit margins may limit spending on critical innovations.
The report, which surveyed 265 construction companies between March and April 2025, also highlights how procurement processes are evolving to support modernization. Nearly 80 per cent of respondents say project tendering is encouraging digital adoption, and 43 per cent report that clients have a strong influence on their tech-related decisions.
Rodrigue Gilbert, president of the Canadian Construction Association, welcomed the shift but said governments need to go further.
“Too often, the system prioritizes lowest price over long-term value, which prohibits investment in innovation,” said Gilbert. “If we want a modern, productive construction sector, governments must reform procurement to foster collaboration, ensure fair risk-sharing, and create the confidence companies need to invest and grow.”
Labour shortages remain a major concern, with 78 per cent of companies reporting difficulty finding skilled workers — down slightly from 90 per cent in 2023, but still a significant challenge. More than 70 per cent said this is affecting their ability to take on or complete projects.
To stay ahead of these pressures, firms are investing in a wide range of technologies, including artificial intelligence, building information modelling (BIM), robotics, drones and prefabrication. Modular construction and AI-driven software were named as top priorities by more than half of respondents.
“The pressure is intensifying on the construction industry to do far more with less,” said Jordan Thomson, director of global infrastructure advisory at KPMG in Canada. “Making a commitment to invest in technology is the first step. Delivering returns requires careful integration and only works if you also invest in up-skilling your people.”
Other top priorities include creating demand-driven supply chains and removing interprovincial trade barriers — with 84 per cent of companies saying harmonizing provincial rules would improve productivity.
As Canada gears up for an ambitious era of nation-building, construction leaders say coordinated action from governments is essential.
“The construction sector is the foundation of Canada’s nation-building ambitions,” said Gilbert. “It’s time for coordinated action. The government must modernize procurement, cut red tape, and provide the clear, consistent policy direction our sector needs to deliver. The time to act — together — is now.”