To get some sense of how much construction activity has slowed over the past few months, one need look no further than Statistics Canada's February building permit release. For the country as a whole, the value of building permits issued in February 2009 dropped by 15.9% month over month. February marks the fifth consecutive month that the total value of permits has slid lower.

From a national perspective, it appears that construction plans for the entire country have been put on hold, but a closer look at individual provinces indicates that this is not the case. For example, the total value of building permits issued over the past six months in New Brunswick is up 35% on a year-over-year basis. This increase is due to very strong increases in institutional (+165%) and industrial (+162%) spending plans and smaller increases in the value of commercial (+ 19.4%) and residential (+8.8%) permits.

In Saskatchewan, despite weakness in residential building plans (-5.8%), a +325% increase in the value of industrial building permits, a more-moderate 49.5% increase in commercial building intentions and a +27.9% increase in institutional building plans pushed the total value of building permits issued over the past six months up by 26.2% year over year.

The value of building permits issued over the past six months is also up on a year-over-year basis in Manitoba (+12.4%), Newfoundland (+11.7%), Nova Scotia (+6.6%) and Québec (+1.4%).

Although the total value of building permits issued in the past six months is up on a year-over-year basis in seven of the 10 provinces, this strength has been outweighed by a significant and broadly based weakening of construction spending plans in three provinces: Alberta (-38.6%), British Columbia (-35.1%) and Ontario (-23.7%).

Looking ahead, total construction spending will probably continue to slow in the very near term. However, given recent moderate increases in commodity prices, signs of stabilizing investor confidence and an unprecedented amount of monetary and fiscal stimulus, the construction outlook will definitely improve late this year and into early 2010.