Labour shortage, population growth inflaming N.B. housing crunch, economist says

The shortage of housing in New Brunswick continues to be fuelled by population growth, says Moncton-based economist Richard Saillant.

"The big pressure is due to turbocharge population growth. Just last year New Brunswick saw population grow by 26,000 — that's more than three per cent," he said. 

"And since the middle of the last decade, we're almost at 70,000 more people living in New Brunswick and that obviously translates into strong demand."

Saillant was commissioned to write a paper for the Housing Hub of New Brunswick, a non-profit organization that was formed in 2022 that focuses on finding more rural housing. In November, the federal and provincial governments each pledged $800,000 toward the organization.

Saillant said in a market where supply can meet demand, every region is served. But this isn't happening in New Brunswick. Instead, housing starts seem to only be occurring in three large centres, Moncton, Fredericton and Saint John, in the form of multiple-unit buildings.

"That's evidence to me that the supply is structurally-constrained. And what's that structural constraint? Well, labour," said Saillant. "We don't have more construction industry workers in this province than we did 10 years ago, yet, we have to build way more units than in the past."

He also said New Brunswick continues to see announcements for big projects like community centres, arenas and schools and these projects will put more pressure on the residential sector.

A similar population growth situation happened in the 1970s, said Saillant, but the market responded much better because the baby boomers were young and there was an ample supply of labour.

"The Government of Canada says that we need to double the cadence of residential construction if we are to meet our needs in this country, and New Brunswick actually has a tighter housing market and its population is growing faster than the Canadian average."

Nearly a third of construction workers in New Brunswick are 55 or older and are expected to retire within the next five years.

Ann Drennan, vice-president academic, innovation and student affairs at the New Brunswick Community College, said for the last number of years there's been a decline in enrolment in the school of trades at the college, which includes professions such as carpentry, plumbing and electrical.

She said there was a small increase for the 2022-2023 academic year, but that the downward trend that was seen over the last few years aligns with what other regions in Canada are seeing.

Drennan said she thinks this is because high school kids haven't necessarily been exposed to trades in the same way as in years past. She also thinks there might be a bit of a negative perception around what it's like to work in the trades.

She said NBCC has been successful at retaining students in the province after they graduate, but there just isn't the same demand for the trade programs as before.

"If I could double my intake, my enrolment, I'd be happy," said Drennan. "We want to take as many as needed. It's, again, just trying to get that encouragement, that student demand there, because the labour market really at the moment is outstripping student demand."

Saillant said there needs to be an all-hands-on-deck strategy to expand the labour supply, starting with immigration. He said training acceleration, credentials recognition and language training are all pieces of the puzzle. 

Unless the labour shortage is dealt with, he said New Brunswick will be divided into the "housing haves and housing have-nots." 

"We have to start looking at housing as a human right, and we have to look at housing as something that is an essential infrastructure," he said.

"We're going to need to ramp up dramatically in the years ahead. And the only way that we can do that is through a combination of expanding the labour supply and making smart investments."