The Canadian Project Risk Index
2025-05-09
Introduction
75% of project owners in Canada report cost overruns, with 77% seeing schedule delays averaging 70 days. This report dissects the root causes and introduces the Canadian Project Risk Index as a predictive tool for SMEs to manage and mitigate such risks.
Causes of Budget Overruns and Schedule Delays
- Scope and Design Changes: Affects ~33% of projects; design errors, late issuance, and revisions.
- Unforeseen Physical Conditions: 25% of projects encounter surprises; often due to rushed planning.
- Permitting Delays: Some permits now take up to 249 days; Canada ranks 34th of 35 OECD nations.
- Labor Shortages: 31.4% of construction firms anticipate shortages; impacts productivity and rework.
- Material Price Fluctuations: Construction inputs up ~40% from pre-COVID levels; procurement disruptions increase schedule risks.
- Environmental Events: Climate disruptions (wildfires, floods) increasingly shut down or slow projects.
Post-COVID Risk Trends
- Pandemic disruptions increased labor and material instability.
- Regulatory approvals slowed due to agency remote work.
- Project scope volatility rose due to changing market and health needs.
Predictive Analytics Opportunity
Fisor Analytics proposes a Canadian Project Risk Index that fuses data across four key domains:
- Permitting Data: Model regional timelines and probability of approval delays.
- Material Prices: Forecast input cost surges using StatCan and futures indices.
- Labor Market Metrics: Predict regional labor shortages using vacancy and wage trends.
- Climate Forecasts: Use Environment Canada data to simulate seasonal and extreme event risks.
This produces a composite risk score for each project, helping SMEs re-sequence tasks, procure early, or change phasing strategies.
Mock Risk Index Table (by Province & Sector)
| Province | Construction | Energy | Infrastructure |
|---|---|---|---|
| British Columbia | 8.0 | 9.0 | 8.5 |
| Alberta | 6.5 | 7.5 | 6.0 |
| Saskatchewan | 5.5 | 6.0 | 5.5 |
| Manitoba | 5.5 | 6.0 | 5.0 |
| Ontario | 6.0 | 6.5 | 6.0 |
| Quebec | 6.0 | 6.5 | 6.0 |
| Atlantic (NB/NS/PE/NL) | 6.5 | 7.0 | 6.5 |
| Territories (YT/NT/NU) | 7.5 | 8.0 | 7.5 |
Real-World Risk Case Studies
- Trans Mountain Pipeline: $7.4B to $30.9B due to regulatory and permitting delays.
- Cowichan Hospital: 63% over original estimate due to labor restrictions and shortages.
- Mid-Sized Ontario Builders: 10–15% cost overruns due to spikes in steel and aluminum.
- Floods and Fires in BC/AB: Shut down projects and made summer work uninsurable.
How Fisor Helps
- Dashboard Visualization: Risk scorecards by factor (e.g., weather 8/10, labor 6/10).
- Automated Alerts: Changes in permit timing, commodity trends, or wage surges.
- Scenario Simulation: “What if fuel costs rise 15%?”—outputs cost and time impact.
- Benchmarking: Compare to peer projects and offer best practice suggestions.
- Continuous Learning: Models improve with each project and forecast iteration.
Conclusion
Canada’s project landscape is filled with predictable, recurring risks—but firms lack integrated foresight. The Canadian Project Risk Index, powered by Fisor Analytics, uses structured public data to help SMEs anticipate, plan, and adapt in real time. In an era of volatile supply chains, climate shocks, and labor constraints, predictive analytics isn't just helpful—it's essential.