Skip to main content
The Globe and Mail
Support Quality Journalism
The Globe and Mail
First Access to Latest
Investment News
Collection of curated
e-books and guides
Inform your decisions via
Globe Investor Tools
Just$1.99
per week
for first 24 weeks

Enjoy unlimited digital access
Enjoy Unlimited Digital Access
Get full access to globeandmail.com
Just $1.99 per week for the first 24 weeks
Just $1.99 per week for the first 24 weeks
var select={root:".js-sub-pencil",control:".js-sub-pencil-control",open:"o-sub-pencil--open",closed:"o-sub-pencil--closed"},dom={},allowExpand=!0;function pencilInit(o){var e=arguments.length>1&&void 0!==arguments[1]&&arguments[1];select.root=o,dom.root=document.querySelector(select.root),dom.root&&(dom.control=document.querySelector(select.control),dom.control.addEventListener("click",onToggleClicked),setPanelState(e),window.addEventListener("scroll",onWindowScroll),dom.root.removeAttribute("hidden"))}function isPanelOpen(){return dom.root.classList.contains(select.open)}function setPanelState(o){dom.root.classList[o?"add":"remove"](select.open),dom.root.classList[o?"remove":"add"](select.closed),dom.control.setAttribute("aria-expanded",o)}function onToggleClicked(){var l=!isPanelOpen();setPanelState(l)}function onWindowScroll(){window.requestAnimationFrame(function() {var l=isPanelOpen(),n=0===(document.body.scrollTop||document.documentElement.scrollTop);n||l||!allowExpand?n&&l&&(allowExpand=!0,setPanelState(!1)):(allowExpand=!1,setPanelState(!0))});}pencilInit(".js-sub-pencil",!1); // via darwin-bg var slideIndex = 0; carousel(); function carousel() { var i; var x = document.getElementsByClassName("subs_valueprop"); for (i = 0; i < x.length; i++) { x[i].style.display = "none"; } slideIndex++; if (slideIndex> x.length) { slideIndex = 1; } x[slideIndex - 1].style.display = "block"; setTimeout(carousel, 2500); }

Construction equipment sits on the site of a condominium development in Toronto on Jan. 2, 2020.

Fred Lum

Capital spending in Canada is expected to hit a record in 2020 that is entirely driven by construction activity, but also shows ongoing weakness from private-sector companies.

Non-residential capital expenditures are expected to climb 2.8 per cent to $275.5-billion, Statistics Canada said Thursday, based on a survey of 25,000 organizations from the public and private sectors. That followed growth of 1.7 per cent in 2019 and 9.8 per cent in 2018. Spending on construction will rise 4.5 per cent to $178.6-billion, while expenditures on machinery and equipment will edge lower by 0.2 per cent.

If those plans come to fruition, total spending would surpass a nominal high set in 2014, before resource companies slashed investments following the commodity-price crash.

Story continues below advertisement

Most of this year’s increase would come from a $6-billion bump from the public sector. Indeed, two recently tabled provincial budgets point to a ramp-up in capital spending by governments. Nova Scotia could see capital spending top $1-billion in its coming fiscal year, with considerably higher investments aimed at schools and roads. British Columbia’s budget this month included plans for a record $22.9-billion in infrastructure spending over the next three years.

Transportation and warehousing was a standout sector, with spending set to grow 9.3 per cent to $44.3-billion, supported by anticipated gains in transit and ground passenger transportation.

“Healthy public sector spending can be a good thing, particularly if, as appears to be the case, it is on productivity enhancing measures such as improved transportation infrastructure,” said Brian DePratto, senior economist at Toronto-Dominion Bank, in a research note.

However, the private sector is set for a tepid increase of 0.9 per cent, the third-weakest growth of the past decade (the two years after the oil-price crash saw the worst showings.) Total spending of $177.6-billion would be lower than it was in 2013, even before accounting for inflation.

Statscan’s survey was conducted between Sept. 18 and Jan. 13. The U.S. House of Representatives approved the new North American trade deal in December, and it was signed into law in late January, easing a concern that had weighed on business sentiment. However, the survey period didn’t overlap with widespread knowledge of the new coronavirus, which is now nearing pandemic status.

“Such a modest outlook even ahead of the latest economic headwinds provide yet another sign that we’re likely in for a challenging year when it comes to economic growth,” said Mr. DePratto.

Your time is valuable. Have the Top Business Headlines newsletter conveniently delivered to your inbox in the morning or evening. Sign up today.

Report an error Editorial code of conduct
Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

Comments that violate our community guidelines will be removed.

Read our community guidelines here

Discussion loading ...

To view this site properly, enable cookies in your browser. Read our privacy policy to learn more.
How to enable cookies