While Canadian construction giants have recently outperformed their U.S. counterparts in stock markets, contractors in both nations face growing uncertainty as escalating trade disputes threaten to disrupt North America’s closely linked construction industry.
Escalating Trade Measures Disrupt Cross-Border Commerce
The U.S. has maintained a 25% tariff on Canadian steel and aluminum since March, followed by additional 10% reciprocal tariffs in April. Canada retaliated with its own 25% duty on U.S. vehicle imports, marking a stark departure from decades of cooperative trade relations symbolized by binational infrastructure projects like the Gordie Howe International Bridge.
Market Performance Diverges Amid Economic Uncertainty
Financial analysts note that Canadian engineering firms WSP and Stantec have significantly outpaced major U.S. competitors such as AECOM and Jacobs in stock performance. Andrew Wittmann, senior research analyst at Baird, attributes this divergence more to structural market differences than direct tariff impacts.
“Canadian firms benefit from stable institutional investors like pension funds, while U.S. companies face more volatile market conditions,” Wittmann explained, noting currency fluctuations further complicate cross-border comparisons.
Construction Activity Shows Resilience, But Risks Loom
Recent indicators suggest Canada’s construction sector continues expanding, with Toronto’s crane count surging 20% since August 2024. However, industry experts warn the trade dispute could soon reverse this momentum.
“Canada and the U.S. have developed deeply integrated construction supply chains,” noted MLT Aikins in a recent analysis. “American specialists and materials remain critical components for many Canadian projects.”
Industry Leaders Warn of Widespread Consequences
The Canadian Construction Association has sounded alarms about potential project delays, cost escalations, and job losses stemming from the tariffs. President Rodrigue Gilbert emphasized the mutual damage:
“These measures threaten the free movement of essential materials that both nations’ construction industries depend on,” Gilbert stated. “The result will be reduced productivity, stalled economic growth, and jeopardized infrastructure projects across North America.”
As trade tensions persist, the construction sectors in both countries face mounting pressure to adapt to higher costs and supply chain disruptions, potentially reshaping long-standing cross-border industry partnerships.
