Canada’s planned surge in federal infrastructure spending is drawing global attention – and with it, global contractors. For local builders and their brokers, that creates a web of new risks layered on top of an already stretched construction workforce.
According to Aiden Lanzon (pictured left), SVP, Quebec regional leader and construction national practice leader at Liberty Mutual Canada, the starting point is simple: there aren’t enough skilled people to build everything that’s being promised.
“There is a fairly large lack of skilled labour to do this work,” he said. “The next hospital that gets announced, let’s say there’s a $5 billion one that they need to build – where are they going to get 500 electricians or something like that, when they have another one down the street that they’re already doing?”
Lanzon pointed to examples like Hydro‑Québec “creating their own university to train a number of their trades” just to secure future capacity. Contractors that don’t think as strategically about staffing, he warned, will be exposed as projects start to overlap and compete for the same people.
That labour pressure is arriving at the same time as a wave of large, complex builds – from ports and tunnels to hospitals and power projects – which demand far more than basic construction skills.
Read more: Mega projects expose GCs to risk
“Complexity is a really big issue,” said Steve Hastings (pictured right), SVP, head of surety for Liberty Mutual Canada. “It’s a complexity issue for the contractor, for the insurer and surety company, but also from the procurement side.”
On mega‑projects, he noted, even the buying side can be out of its depth.
“You may be dealing with a procurement agency that is really not experienced in a project of this size,” Hastings said. “You may get a mismatched contract model or individuals who have not gone through this process before. That can really add to the challenge of successfully completing these types of projects on time and on budget.”
To fill labour and expertise gaps, Canadian GCs are increasingly looking abroad – a trend Lanzon has already seen play out in other regions where Liberty Mutual operates.
“This is a risk that I think exists in Canada, for sure,” he said. “Other companies, construction companies from elsewhere in the world, coming into a local geography.”
Sometimes that means subcontractors; in other cases, full joint ventures on specialist work such as tunnelling. Either way, Lanzon cautioned that local knowledge can’t be assumed.
“In choosing your joint venture or somebody who’s going to be your supplier or your subs, you want to be very sure about their experience in that local country,” he said. “Canada is a pretty good example of the cold, and the settling of the ground.”
He pointed out that even within Canada, conditions vary dramatically.
“Some people may think Canada is just a cold place,” he said. “But the winter in Quebec and the winter in Alberta are different winters. They’re both cold, there’s no doubt about that, but they are different. And it’s to understand those elements.”
When companies arrive without that understanding, he added, relationships can deteriorate quickly.
“That is what we’ve seen in other places in the world where you have people coming in and they’re not as experienced,” Lanzon said. “It actually makes the relationship between the people who are doing the joint ventures arduous if they haven’t pre‑selected that partner in the right way. There have been instances of municipalities and governments kicking foreign contractors off because it’s gone so bad.”
Hastings agreed that local presence and relationships are critical.
“You need that local presence, that local knowledge, the local relationships. And that’s vital,” he said. “If you are an international contractor and you come into Canada to take on one of these big jobs and you don’t have that local understanding, your chances of success are greatly diminished.”
All of these pressures – stretched labour, unfamiliar partners, complex procurement and evolving climate‑resilience requirements – tend to collide in the claims file.
Asked whether there was a single red flag that signalled trouble, Lanzon said most large losses are the opposite of simple.
“It’s generally a confluence of a couple of things happening at the same time,” he said. “Most of the large claims we end up seeing involve a series of unlikely events – things that almost feel like they were made up for a movie: first this happens, then that happens, then something else.”
For insurers and sureties, that reality reinforces the need for deep, ongoing engagement with contractors as they scale up for the infrastructure boom. For brokers and GCs, it underlines a more basic message: in a market defined by long projects and tight capacity, choosing the right people – on site, in the joint venture and on the carrier side – may be the most important risk decision they make.
