Canadian Occupational Projection System (COPS)

Industrial Summary

Architectural, Engineering, Design and Scientific R&D Services

(NAICS 5413; 5414; 5417)

This industry comprises establishments that provide highly specialized business services in three different segments. Architectural, engineering and related services are by far the largest segment, accounting for 80% of production and 73% of employment in 2018. In comparison, specialized design services (which include interior, industrial and graphic design) accounted for only 5% of production but 16% of employment, versus 15% and 10% respectively for scientific research and development services. The industry employed 344,300 workers in 2018, mostly concentrated in Ontario (37%), Quebec (23%), Alberta (17%) and British Columbia (14%). The workforce is mainly composed of men (65%) and characterized by a high level of education and a significant proportion of self-employed (28%). Key occupations (4-digit NOC) include:

  • Graphic designers and illustrators (5241)
  • Civil engineers (2131)
  • Other professional engineers, n.e.c. (2148)
  • Interior designers and interior decorators (5242)
  • Drafting technologists and technicians (2253)
  • Architects (2151)
  • Mechanical engineers (2132)
  • Electrical and electronics engineers (2133)
  • Civil engineering technologists and technicians (2231)
  • Engineering managers (0211)
  • Construction inspectors (2264)
  • Geoscientists and oceanographers (2113)
  • Land survey technologists and technicians (2254)
  • Architecture and science managers (0212)
  • Chemical technologists and technicians (2211)
  • Petroleum engineers (2145)
  • Biologists and related scientists (2121)
  • Theatre, exhibit and other creative designers (5243)
  • Mechanical eng. technologists and technicians (2232)
  • Architectural technologists and technicians (2251)
  • Electrical and electronics engineering technologists and technicians (2241)
  • Industrial engineering and manufacturing technologists and technicians (2233)
  • Chemists (2112)
  • Non-destructive testers and inspection technicians (2261)
  • Land surveyors (2154)
  • Biological technologists and technicians (2221)
  • Geological and mineral technologists and technicians (2212)
  • Industrial designers (2252)
  • Chemical engineers (2134)
  • Geological engineers (2144)
  • Industrial and manufacturing engineers (2141)
  • Physicists and astronomers (2111)
  • Landscape architects (2152)

The industry strongly relies on the performance of the domestic economy and is largely driven by business investment and government expenditures, as well as research and development (R&D) activities. More precisely, the architectural and engineering segment and the design segment are heavily tied to residential and non-residential investment and the resulting impact on construction activity. Demand for engineering services also relies on business investment into machinery and equipment (M&E). In comparison, the R&D segment is closely tied to R&D spending from the private and public sectors for the development of new innovative products and technologies. Spending on R&D activities is generally driven by profitability in the private sector and by government expenditures in the public sector. After being negatively affected by the deterioration of the economic conditions during the recession of 2008-2009, output in the industry increased markedly from 2010 to 2012. Production stagnated in 2013-2014, before falling significantly in 2015-2016 and stabilizing to relatively low levels in 2017-2018. This situation primarily reflects the fact that non-residential investment and construction activity were severely affected by major investment cutbacks in mining, oil and gas engineering structures due to the declining trend in metal and energy prices. Indeed, demand for engineering services started to ease in 2012 when metal prices began to weaken, and then fell markedly after crude oil prices plummeted in 2014-2015. Negative growth in R&D spending and M&E investment over the past decade is an additional factor that contributed to restrain demand for R&D and engineering services. On average, real GDP in the industry increased by a modest 0.6% annually during the period 2009-2018, with most of the growth occuring prior to 2013. On the employment side, growth largely tracked the rate of output, albeit at a faster pace of 1.1% per year. Despite significant declines in non-residential invesment in recent years, growth in residential investment remained solid for most of the past decade (with the exception of a notable decline in 2018), supporting labour demand for architects, engineers and designers. Declining productivity reflects the fact that the sharp fall in non-residential investment following the oil price shock severely affected activity in the industry, lowering revenues and profitability, forcing many firms to reduce their capital expenditures, including investment in new technologies.

Over the projection period, output growth in the industry is expected to accelerate markedly relative to the period 2009-2018, primarily driven by faster growth in non-residential building investment and renewed growth in business investment related to machinery and equipment. More specifically, the demand for architectural, engineering and design services is expected to be situmated by the acceleration projected in the construction of industrial and commercial buildings, in response to high industrial capacity utilization rates, low office vacancy rates in the Toronto and Vancouver areas, and robust demand for warehouse space due to the growing adoption of e-commerce. The federal government’s infrastructure program ($186 billion over 12 years) is also expected to support the construction of public engineering structures and institutional buildings. In addition to transportation, public transit, green and rural infrastructures, this program also includes spending on “social infrastructure” such as cultural and recreational infrastructure. Furthermore, after holding back on investment in machinery and equipment (M&E) for years, Canadian businesses are expected to replace or upgrade their existing capital stock in response to the development of new productivity-enhancing technologies, the acceleration anticipated in manufacturing activity, and demographic pressures on labour supply. Those factors are projected to result in a substantial rebound in M&E investment in Canada, boosting demand for engineering services. Similarly, renewed growth in corporate profitability is also expected to result in a substantial rebound in business investment related to intellectual property, including R&D activities. This will boost the demand for the industry’s expertise in various fields of scientific research and industrial design.

However, the demand for architectural services is expected to be contained by the slowdown anticipated in residential investment. While mortgage rates remain low, several factors are expected to limit investment in new housing, including stricter mortgage rules, high household debt, and the gradual decline anticipated in household formation. Anemic growth in business investment related to engineering structures, largely attributable to the resources sector in response to a tepid outlook for oil and metal prices, is also expected to restrain demand for engineering services. On the trade side, there is some potential to increase exports of engineering and architectural services as demand for Canadian expertise is growing rapidly. In addition to the relatively low value of the Canadian dollar which improves price-competitiveness, particularly in the United States, the mutual recognition of professional qualifications under the Comprehensive Economic and Trade Agreement (CETA) is expected to enable the industry to bid on service contracts within the European market. On average, the industry’s real GDP is projected to increase by 2.1% annually over the period 2019-2028, a notable acceleration relative to the previous ten years. In comparison, employment growth is expected to slow marginally, averaging 1.1% per year, leading to a major turnaround in productivity. This situation reflects the need to improve productivity in response to growing difficulties in recruiting highly qualified workers and the need to improve cost-competitiveness in response to more open competition on the global market, particularly with the implementation of CETA. For example, occupations related to mechanical engineering (NOC 2132), including technologists and technicians (NOC 2232), are expected to keep showing signs of shortages over the next ten years. In a context where it will be increasingly challenging to hire additional workers, the industry is expected to adopt productivity-enhancing technologies such as building information modeling (BIM) systems to automate much of the work of design and engineering, 3D printing to produce components for modular construction, and drones to monitor and inspect large or difficult-to-access structures.

Real GDP and Employment Growth Rates in Architectural, Engineering, Design and Scientific R&D Services

Figure showing the annual average growth rates of real GDP and employment over the periods 2009-2018 and 2019-2028 for the industry of architectural, engineering, design and scientific r&d services. The data is shown on the table following this figure

Sources: Statistics Canada (historical) and ESDC 2019 COPS industrial projections.

Text Version of Figure Real GDP and Employment Growth Rates in Architectural, Engineering, Design and Scientific R&D Services (%, annual average)
  Real GDP Employment
2009-2018 0.6 1.1
2019-2028 2.1 0.9

Sources: Statistics Canada (historical) and ESDC 2019 COPS industrial projections.


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