Infrastructure reflects the times in which it is created. In Alberta, a literally off-the-wall example can be found in the control panels at the Turner Valley Gas Plant – a mothballed facility now being prepared for restoration as a historic site. Made in Germany during the 1930s, its control panels sport swastikas welded into the steel – a reflection of the political turmoil of the day.
The network of firms that create and maintain roads and industrial facilities make up the infrastructure business. Combined, they represent a huge segment of the modern economy. In Alberta in recent years, this business has been increasingly dominated by efforts to develop oilsands infrastructure, but since the beginning of the global financial crisis that has changed.
Infrastructure firms with contracts to design, engineer and construct massive projects like Petro-Canada’s postponed Fort Hills project have led to layoffs in professions where, a year ago, the demand was almost desperate. However, these cases have not yet been large. Indeed, many companies sense a need to rebalance the sector. Once that’s done, they say, demand for new and revitalized infrastructure will remain strong. Indeed, there is even a sense among some firms that both the province and the oilsands industry itself can benefit from the breathing room the slowdown is providing. Perhaps the irrational exuberance of the last few years really needed a pause for serious contemplation.
I do not own any of the stocks mentioned in this article, which comes from my blog.