🙃 Going underground

Together with

Good morning! Aspiring business owners need more grit. A recent government study estimates there are 100,000 fewer business owners than there were 20 years ago. Researchers say part of the secret to reviving entrepreneurship is teaching “grit”, or one’s ability to solve problems, recover from failure and manage stress.

In this issue:

💰 Construction’s $23-billion underground economy

📈 ’The One’ racks up debt

💼 October People Moves

MARKETS

*Stock data as of last market close; currency, oil and crypto data as of 12:00PM ET October 23rd, 2023.

Economy: Inflation is chilling out just in time for the fall. Canada’s inflation rate dropped more than expected in September to an annual pace of 3.8% in a broad-based easing. Economists say this could give the Bank of Canada the justification to hold interest rates.

THE BIG STORY

Uncovering construction’s hidden economy

A Toronto man looking to build his dream home a little cheaper and faster recently found himself out $235,000 after getting taken advantage of by a contractor that made a lot of promises but delivered little. He soon found the unlicensed company had left a destructive trail of bounced checks, unfinished projects and cut corners.

Welcome to the booming underground economy. It consists of market-based economic activities that escape measurement because of their hidden, illegal, or informal nature.

A big secret: In 2021, the residential construction industry accounted for 35% ($23.9 billion) of all underground economic activity, by far the largest contributor of any industry. Underground residential work surged 32.8% that year.

How it works: Reports show the most common strategy is to deliberately misclassify workers as independent subcontractors to avoid payroll costs. This can save underground contractors 20% on labour, allowing them to unfairly compete for work.

The larger costs: In addition to stealing from workers, it steals from all of us. The CRA estimated that hidden income earned in the construction industry accounted for over one quarter of all unreported personal income tax in 2018, which represents $10 billion in unreported taxable income and $2.1 billion in estimated loss in tax revenue.

NEED TO KNOW

The week's headlines

🏗️ The One, an 85-storey luxury condo and retail development in Toronto that aimed to be Canada’s tallest building has been placed in receivership after facing construction delays and cost overruns racked up $1.6 billion in debt. The tower was originally scheduled for completion last December at a cost of $1.4 billion.

🚧 Three teams have been shortlisted for a $4.15B tunnelling project in B.C. The project includes building an eight-lane immersed tube tunnel under the Fraser River. The teams will now submit proposals to enter into a Design Early Works Agreement. The province expects to have a team chosen by spring 2024.

⚒️ Quebec is considering easing provincial regulations around construction trades certification to make work easier. Currently rules forbid workers from doing tasks outside their area of practice which critics say creates major inefficiencies on sites.

👷‍♀️ Nova Scotia will spend $100 million over the next three years to increase its number of tradespeople. The province aims to add up to 5,000 new apprentices to the system. According to provincial officials, Nova Scotia needs about 11,000 new certified trade professionals by 2030. Currently they are 38% behind recruitment goals.

TOGETHER WITH RDM EQUIPMENT SALES AND RENTALS

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PROJECT SPOTLIGHT

Healthcare heats up in Newfoundland/Labrador

The $723-million Corner Brook Acute Care Hospital in Newfoundland and Labrador is breaking new ground for healthcare facilities. Corner Brook Health Partnership - consisting of Plenary Group, PCL Constructors Canada, Marco Services, and Johnson Controls Canada - is the P3 project team delivering the facility. Part of their sustainable design includes the largest

PROJECT UPDATES

Structural work complete at Cowichan's Quw'utsun Secondary School

Third tower approved for Georgetown community in Surrey

RFQ closed for Trillium Health Partners Broader Redevelopment Project 

Work begins on $14M library for Kitchener 

Crews begin work on final stretches of Calgary Ring Road

WHAT WE’RE TALKING ABOUT

LIST: 👷‍♀️Check out October’s biggest construction career news

VIDEO: 🛸 PCL uses drones to create photorealistic project model

PHOTOS: 🦺 The difference properly fitted PPE makes for women

READ: 🩻 LNG Canada donates $900K for Kitimat CT scanner

VIDEO: 🍎 Construction mental health campaign hits Times Square

HOT JOBS

Parts and Service Coordinator - Vaughan, Ont. - Aquatech Dewatering Company

Senior Construction Estimator - Vancouver, B.C. - Scott Construction

Water Treatment Engineer - Vaughan, Ont. - Aquatech Dewatering Company

Project Manager (Hybrid Schedule) - Harrison Mills, B.C. - Scott Construction

🔥 Check out all roles up for grabs right now at SiteNews Jobs or put your job post in front of tens of thousands of construction professionals here. Hurry up before our free trial ends!

Struggling to fill a role? send us an email at [email protected] to connect with one of our specialized recruitment experts.

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Here’s to a great rest of the week!E