Table of contents
- Key highlights
- A wave of investment is coming
- Major projects could propel Canada’s economy
- Major project investment will affect sectors differently
- The right positioning is key for businesses to benefit from major projects
- Businesses involved in major projects are eager for more
- Businesses involved in major projects face significant challenges
- Reducing barriers is key to greater SME participation in major projects
- Conclusion
- Methodology
Canada is entering a period of significant investment. Major projects are planned in defence, housing and infrastructure, energy, mining, natural gas and artificial intelligence (AI). These projects could strengthen supply chains, create opportunities for businesses across the country and shape Canada’s economic future.
To better understand the scale of this opportunity, BDC conducted a study supported by calculations from the Transition Accelerator. BDC assessed the potential economic impact and surveyed 1,000 Canadian small and medium-sized enterprises (SMEs):
- 750 businesses already involved in major projects
- 250 businesses not yet involved but interested in participating
Key highlights
- Canada could attract an additional $670.6 billion in investment between 2026 and 2030 across five key areas: defence, housing and infrastructure, energy, mining and natural gas, and AI data centres.
- By 2030, these investments could raise real GDP by 4.1% above the baseline and generate an additional $443 billion in cumulative economic activity between 2026 and 2030—equivalent to more than $10,000 per Canadian.
- An estimated 280,000 Canadian businesses could be directly affected by these investments. The strongest growth is expected in construction, mining, manufacturing, professional services and wholesale trade.
- Many SMEs already participate in major projects. Those involved tend to be larger, faster-growing and more growth-oriented.
- Two-thirds of participating SMEs expect to increase their involvement in major projects over the next 24 months, indicating confidence in future opportunities.
- Most SMEs say they have the capacity to take on more work, but they still face barriers related to financing, cash flow, complex procurement, labour shortages and limited information about opportunities.
- Businesses not yet involved face several barriers, including financial constraints, risk exposure, complex procurement requirements and difficulty identifying opportunities and partners.
- Helping more SMEs participate will be critical to maximizing the economic benefits of Canada's major project pipeline. This will require better financing, clearer information, stronger partnerships and more accessible procurement processes.
A wave of investment is coming
Canada’s major project pipeline is taking shape amid shifting government priorities and growing global demand. Federal commitments to defence, housing, infrastructure, resource extraction and economic sovereignty are expected to drive major projects in the years ahead. At the same time, higher defence spending among Canada’s allies and growing demand for critical minerals, energy and clean technologies are creating further momentum.
The Government of Canada has announced major investments across five key areas, each with significant implications for Canadian businesses:
- Defence: Canada’s commitment to increase defence spending to 5% of GDP by 2035 is expected to generate significant new economic activity.
- Housing and civil infrastructure: Investment is needed to increase the housing supply, improve affordability and renew aging infrastructure.
- Energy: Energy systems are being expanded and modernized to support electrification and rising demand from emerging industries such as AI. Major investments are also planned in liquefied natural gas (LNG) and nuclear power.
- Mining: Canada’s critical mineral resources could help meet growing global demand from clean technology and advanced manufacturing industries.
- AI data centres: Investments in data centres could help Canada build secure, sovereign infrastructure for storing and processing data.
Together, these areas form a major project pipeline that could reshape parts of the Canadian economy. The next section examines its scale and potential economic impact.
Major projects could propel Canada’s economy
The Transition Accelerator estimates that planned major projects could generate an additional $670.6 billion in investment in Canada between 2026 and 2030 (Graphic 1). BDC’s Economic Research team used this estimate to model the potential impact on the Canadian economy. The estimate was calculated by comparing a detailed schedule of planned projects with the 2024 baseline forecast for major project investment.
Our modeling shows that this additional investment could raise Canada’s real GDP by 4.1% above the baseline scenario by 2030. Much of this activity would flow through the supply chains supporting these projects, creating significant opportunities for Canadian SMEs. Between 2026 and 2030, it could generate an additional $443 billion in cumulative economic activity—equivalent to more than $10,000 per Canadian, based on Statistics Canada’s population projections.
But to get there, we need to create the right environment for businesses to access these opportunities and scale up. This means:
- improving access to financing
- removing barriers to project execution
- streamlining regulatory approvals
- expanding infrastructure capacity
- building a skilled workforce
- making it easier to find information about opportunities
Graphic 1: Additional investment estimated across the 5 key areas, $B
Major project investment will affect sectors differently
The economic impact of these investments will vary across sectors. Construction is expected to see the largest percentage growth, rising 20% above the baseline scenario. This is not surprising, since many planned projects will require new or upgraded infrastructure.
The benefits extend well beyond construction. Mining, quarrying and oil and gas extraction are expected to see the next-largest increase, at 7.0% above the baseline. Manufacturing; professional, scientific and technical services; and wholesale trade are also expected to see notable gains (Graphic 2).
Defence spending is one example of how major projects can create opportunities across multiple industries. While 28% of planned defence spending is expected to go toward infrastructure, 40% is expected to go toward machinery and equipment, creating direct opportunities for advanced and specialized manufacturing.
SMEs are well positioned to contribute. They operate across construction, manufacturing, professional services, transportation and many other industries connected to these significant investment projects.
Graphic 2: Impact on GDP growth compared to the baseline scenario, by industry, 2026-2030
The right positioning is key for businesses to benefit from major projects
An estimated 280,000 Canadian businesses could be directly affected by these investments. However, some businesses are better positioned than others to benefit from increased project activity. Understanding these differences helps us identify which firms are best positioned to expand their participation and where additional support may be needed.
SMEs involved in major projects tend to be larger and faster-growing
SMEs involved in major projects tend to be larger and grow faster than other businesses. They are most common in primary sectors, technology, construction and manufacturing. Their role often depends on their industry. For example, construction firms tend to lead projects, technology firms often provide professional or technical services, and retailers supply goods.
We identified two groups of SMES currently involved in major projects:
- Highly involved SMEs: More than 50% of their revenue comes from major projects.
- Lightly involved SMEs: Less than 24% of their revenue comes from major projects.
Highly involved SMEs
Highly involved SMEs tend to be larger: nearly half (44%) employ more than 100 people. They are most common in construction (28%), followed by technology and information services (18%) and manufacturing (11%). They are also more likely to take on lead roles in large-scale projects, including real estate developments and industrial facilities.
These businesses also report strong growth. More than half increased their revenue by 10% or more. They also demonstrate a strong growth mindset: 85% have invested, or plan to invest, significant resources in growth-oriented initiatives.
Lightly involved SMEs
Lightly involved SMEs tend to be smaller in size: nearly half (48%) employ fewer than 20 people. They are most common in retail (14%), manufacturing (10%) and construction (13%). They also operate in transportation and warehousing (5%) and accommodation and food services (8%).
Most lightly involved SMEs also reported revenue growth, but their gains were generally smaller. Nearly nine in 10 reported revenue growth below 10%, while 14% achieved growth of 10% or more. Despite their lower level of involvement, these businesses also demonstrate a growth mindset: 78% have invested, or plan to invest, significant resources in growth-oriented initiatives.
The two groups differ in size, growth and the types of work they take on. Their level of involvement appears to influence both the roles they play (Graphic 3) and the types of projects (Graphic 4) they take on. The largest gaps between the two groups are in lead roles and participation in energy- and infrastructure-related projects. Despite these differences, both groups demonstrate a growth mindset.
Graphic 3: Roles of SMEs in major projects, by level of involvement
Graphic 4: Types of major projects SMEs pursue, by level of involvement
Those who responded “do not know” were excluded.
Businesses involved in major projects are eager for more
Survey respondents already involved in major projects appear more positive than cautious about taking on more work. Most expect their participation to grow in the coming years, suggesting that they see new opportunities emerging from Canada's expanding project pipeline.
Nearly two-thirds expect to increase their involvement over the next 24 months. This share is highest among high-growth firms (88%), firms in technology and primary sectors (77%) and younger entrepreneurs (71%).
Future intentions also vary by current level of involvement. Highly involved businesses appear more optimistic and proactive in their plans to expand. With at least half of their revenue coming from major projects, 38% expect their involvement to increase significantly over the next 24 months. Lightly involved SMEs also show an appetite for growth, but their expectations are more moderate: 42% expect their involvement to increase only a little (Graphic 5).
Graphic 5: SME’s intentions of increasing involvement, by level of involvement
Businesses involved in major projects face significant challenges
Businesses face several challenges when taking on major projects (Graphic 6). The most common involve complex procurement processes and financial pressures, including:
- competitive bidding pressures
- unfavorable payment terms
- uncertain project scope
- contract conditions that make projects less attractive
These challenges vary slightly by level of involvement. Complex administrative and procurement processes are a greater obstacle for highly involved SMEs, while cash flow issues are more common among lightly involved SMEs.
Challenges also vary by project type. Among SMEs involved in large commercial, residential or institutional projects, 33% report difficulties coordinating with project owners or contractors. Meanwhile, 32% of those involved in digital or technology infrastructure projects report challenges related to complex administrative, technical or compliance requirements.
Graphic 6: Top challenges faced by SMEs involved in major projects, by level of involvement
Those who responded “do not know” were excluded.
Although challenges and capacity limits can make major projects difficult to manage, highly involved SMEs appear well equipped to navigate this environment. A large majority of SMEs (90%) are open to partnerships, whether they have previously collaborated with other businesses on major-project opportunities or not.
And nearly two thirds (63%) would continue to pursue a project even if it became too challenging, showing their determination to succeed.
Reducing barriers is key to greater SME participation in major projects
SMEs could take on more
Most SMEs say they have the capacity to take on more projects, regardless of their current level of involvement. However, capacity varies between the two groups (Graphic 7). Among highly involved SMEs, 38% say they could expand their participation without difficulty, compared with 21% of lightly involved SMEs.
Although most businesses have room to increase their involvement, many expect to do so gradually. Among SMEs that expect to participate more in major projects, 54% say they can expand only to a limited extent. Lightly involved SMEs appear to face greater constraints: 20% say they would need significant changes or additional support to expand their participation—or could not take on any more major projects.
Graphic 7: SMEs’ capacity to take on more, by level of involvement
Responding to demand will require SMEs to boost capacity
Realizing the full potential of Canada's major project pipeline will require a substantial increase in productive capacity. Our analysis suggests that meeting projected demand will require about 580,000 workers by 2030, many of them in construction (Graphic 8). This is far more than Canada’s workforce is expected to grow over the same period.
Canada has met similar workforce demands during past periods of major infrastructure investment. In the early 2000s, for example, construction employment grew by more than 5% a year for four consecutive years. But today’s conditions are different. Canada's population is aging, labour force growth is slowing, and the construction sector already faces worker shortages. Expanding the workforce alone will not be enough.
To make the most of this economic opportunity, Canada will also need to invest in measures that help businesses produce more, including:
- automation
- digital technologies
- advanced equipment
- better processes
- more efficient collaboration across supply chains
Helping each worker produce more will be critical.
SMEs involved in major projects recognize these constraints. To boost their capacity, they say they need workers with specialized skills, as well as equipment, subcontractors and internal resources.
Graphic 8: Employment growth needed to meet major project demand, 2000-2030
Several measures could increase SME participation
When asked which organizations could improve their access to major project opportunities, respondents most often point to financial institutions (44%) and public agencies (40%). Manufacturers are especially likely to look to financial institutions, while larger businesses want the government to play a more active role.
SMEs already involved in major projects also identified measures that could help them participate more, shedding more light on what action is needed (Graphic 9).
Highly involved SMEs place greater importance on lower financial or bonding requirements (32%) and shorter, more predictable timelines (30%). This reflects the operational and financing challenges faced by firms already active in major projects.
Lightly involved SMEs are more likely to call for targeted support or mentoring (32%) and for large contracts to be divided into smaller parts (21%). This suggests they face barriers related to knowledge, capability and access to opportunities.
Both groups agree that better access to information (34%) and lower financial or bonding requirements are among the most important measures. This suggests these are common barriers, regardless of an SME’s current level of involvement.
Graphic 9: Main factors preventing interested SMEs from pursuing a major project
Those who answered “do not know” were excluded.
Reducing barriers could help interested SMEs pursue major projects
SMEs that are interested in major projects but not yet involved tend to be smaller. More than one-third (37%) have between one and four employees. They are most common in the construction, retail and professional services sectors. Most are profitable, but their revenue growth is modest: 79% reported growth of less than 10% in recent years.
Financial constraints are the main barriers for these businesses. Nearly half (44%) cite challenges, such as upfront costs, cash flow needs and financial risk. This is an even greater concern among larger firms, with 63% citing them as a barrier. Other common challenges include risk exposure and difficulty finding suitable partners or project opportunities (Graphic 10).
Barriers also vary by industry. In construction, 41% of businesses cite complex procurement and contracting processes as a main challenge. In transportation, half (50%) say their biggest challenge is finding project opportunities or the right partners.
Although financial constraints are the most significant obstacle, surveyed businesses identified several measures that could help them participate more in major projects. Better access to information about upcoming opportunities is the most common need (37%). Many businesses would also benefit from dividing large contracts into smaller parts or subcontracts (34%). This would make major projects more accessible to firms with less experience or fewer resources.
Graphic 10: Measures to increase participation in major projects, according to involved SMEs
Those who answered “do not know” were excluded.
Conclusion
Canada’s major project pipeline represents a significant source of economic growth for SMEs across the country. Many businesses are ready to take on more. Others are eager to get involved.
But Canada must act now to realize the full potential of these investments. Businesses need to build capacity and improve productivity. Governments, financial institutions and project owners must also work together to remove barriers and create more ways for SMEs to participate.
Methodology
An online survey was conducted between May 4th to 25th, 2026, among 1000 business owners and business decision-makers from the Forum Research panel, involved in major projects or with the intent or interest to get involved in the coming years.
Data processing and analysis were performed by the BDC Research and Market Intelligence team. The data has not been weighted.
For a probabilistic sample of 1000 respondents, the maximum margin of error is ± 3.9% percentage points 19 times out of 20.
However, as this survey is based on a non-probabilistic sample, the above information is provided for reference only.
Acknowledgements
This report was written under the direction of Arnaud Franco, director, Economic Research, BDC. It was made possible through the collaboration of Magalie Nadeau, Nathalie Gauthier, Sami Abou Daya, Christina Kairouz, Roseline Joyal-Guillot, Carine Bergevin-Chammah and Mathieu Galliot from BDC, as well as the Transition Accelerator.
It is based on survey data and public information that was analyzed and interpreted by BDC. Any error or omission is the sole responsibility of BDC. All figures in this report have been rounded. Use of the information herein is exclusively the reader’s responsibility.