From CMHC

Housing affordability is challenging Canadians. To address this, CMHC has shown that we need to double housing starts over the next decade. Meeting this goal will require building smarter and faster, with governments and business working together. While governments can improve regulations, the residential construction industry will need to invest to improve its productivity. What are the current productivity challenges in building housing in Canada, and what solutions show the most promise?

Productivity measures how much output, such as housing, is produced for each hour of work. Increasing productivity isn’t about working more hours—it’s about working smarter. This means investing in the latest tools and equipment, ensuring workers have top-notch skills. It also involves using innovative and effective management techniques and reorganizing businesses to take advantage of these improvements.

The productivity performance of the residential construction industry has been much weaker since the pandemic, contributing to the loss of housing affordability. The Centre for the Study of Living Standards estimates that lost productivity from 2019 to 2024 added $6 to $8 billion to housing construction costs in Canada. This accounts for up to 20% of the increase in new home prices. Boosting productivity in residential construction would also strengthen Canada’s overall economic performance. In 2024, residential construction accounted for 4.2% of business-sector employment but only 3.3% of business-sector value added.

https://www.cmhc-schl.gc.ca/observer/2025/framework-for-change-productivity-in-housing-construction