Report: GTA housing slump puts 41,000 jobs and $10B in construction spending at risk

Key Takeaways:

• If new home sales in the GTA don’t rebound, up to 41,000 jobs across the construction sector and related industries could disappear over the next five years, according to Altus Group.
• The value of residential construction could shrink by more than $10 billion, with single-family and apartment construction both seeing major declines by 2029 if current trends persist.
• The report warns that high prices, excessive taxation, and an ill-suited housing mix are stalling sales and threatening the construction pipeline — and calls on governments to address these barriers before the economic fallout deepens.

The Whole Story:

A prolonged slowdown in new home sales could put nearly 41,000 jobs and $10 billion in construction activity at risk across the Greater Toronto Area, according to a new report by Altus Group.

The economic modeling exercise, released this month, warns that if current sales trends continue, the region’s residential construction pipeline could dry up over the next five years — gutting what has long been a key employment engine.

“New housing construction is an important generator of jobs in Toronto,” the report stated. “However, the sharply lower volumes of construction activity that could come about from a prolonged weak sales period… could mean that this trusted and important jobs engine will stall.”

The GTA has already seen new home sales drop to historic lows in early 2025. Sales of single-family homes are down more than 50% compared to last year, while condo apartment sales have plunged nearly 65% — declines that Altus Group says are threatening to choke the entire housing production pipeline.

If sales fail to recover, Altus projects that annual construction starts could fall by tens of thousands of units by 2029. Investment in single-family housing construction would shrink from $6.7 billion in 2024 to just $1.9 billion, while apartment construction spending — including purpose-built rentals — would drop from $7.5 billion to $2.6 billion.

The jobs impact would be severe. The report estimates the loss of 18,500 direct construction jobs and another 22,500 indirect and induced positions — a combined decline of nearly 47% from recent employment levels.

That drop would come on top of already worsening labour conditions. Construction employment in Toronto has fallen by 34,600 jobs since late 2023, and Ontario’s construction unemployment rate hit 10% in April — the highest since the depths of the pandemic.

“The number of vacant construction jobs in Ontario, which had been as high as 8% of all jobs in 2022, has fallen to a low of 2.6; a sign of slackness in the market not seen for many years,” the report noted.

Altus emphasized that the scenario is not a forecast but rather a “what-if” exercise designed to highlight the risks if policy action is not taken. The firm cited high prices, excessive taxes, and an ill-fitting mix of housing types in the approvals pipeline as barriers to recovery.

“The message from this analysis is to raise the urgency of addressing barriers now, before these longer-term implications on the pipeline of construction and ultimately on jobs and the broader economy set in,” the report concluded.

The findings add further urgency to calls from developers and housing advocates to streamline approvals and improve affordability in one of Canada’s most economically important regions.