Major infrastructure projects do not always stall because of engineering problems, labour shortages, or rising construction costs. Sometimes, the biggest obstacle is obtaining permission to move forward.
That is the challenge facing Montreal-based engineering giant WSP Global, whose chief executive, Alexandre L’Heureux, says reviews initiated under U.S. President Donald Trump are delaying major infrastructure projects south of the border.
The administrative reviews, particularly those involving federal infrastructure and clean-energy funding, have slowed progress on certain contracts and complicated cash flow. Yet WSP maintains that American demand remains strong, even as some projects take longer to begin.
The situation highlights a growing challenge for Canadian companies operating in the United States: navigating changing government priorities while managing multibillion-dollar project pipelines, investor expectations, and the practical demands of keeping engineers working.
Contracts Are Being Won, but Work Is Taking Longer to Start
For WSP, one of the most frustrating aspects of the current situation is that some projects have already passed important commercial milestones. The company has secured assignments, but receiving permission to begin work is taking longer than expected. During WSP’s November 5 earnings call, L’Heureux explained that the interval between project awards, funding authorization, and actual construction-related activity has expanded in parts of the American business. He pointed particularly to public infrastructure projects where state and local governments depend on federal funding before releasing engineering work.
The distinction matters because a contract award does not necessarily translate into immediate revenue. Consider a transportation authority preparing to upgrade an aging bridge. Even after selecting an engineering consultant, the agency may still need confirmation that funding is available before authorizing detailed design or construction support. Engineers can be ready, the project can remain a priority, and the work can still be postponed. WSP says this type of timing problem became more noticeable during the second half of 2026. Management has emphasized that the delays affect certain projects rather than every part of its American operations.
Trump’s Changes to Federal Funding Have Added Another Layer of Review
The disruption is connected to changes in how Washington evaluates infrastructure spending approved under former president Joe Biden. Two major pieces of legislation are particularly relevant: the Infrastructure Investment and Jobs Act of 2021 and the Inflation Reduction Act of 2022. Together, they established substantial federal support for transportation, energy, environmental, and other infrastructure programs. Many initiatives depend on funding arrangements involving federal agencies, state governments, local authorities, and private-sector contractors. That creates several stages between legislative approval and the moment an engineering firm can begin its assignment.
On January 20, 2025, Trump issued an executive order directing agencies to pause certain disbursements and review spending under those laws for consistency with his administration’s priorities. Subsequent White House guidance clarified that the pause applied to funding implicated by the order’s policies, rather than every dollar allocated under the two laws. Nevertheless, agencies adopted review procedures that could affect previously announced funding. For companies such as WSP, the practical concern is uncertainty about when clients can access money and authorize work. A policy review in Washington can therefore influence project schedules far beyond the federal government’s own offices.
A Federal Audit Reveals How Extensive the Reviews Have Become
The scale of the government’s review process is documented in a July 2026 report from the U.S. Government Accountability Office. Examining four federal agencies, the watchdog found that approximately 9,500 infrastructure and energy-related awards worth $128 billion had been approved following reviews. Another roughly 800 awards, worth $17.8 billion, had been cancelled, while more than 2,500 awards representing $33.6 billion were awaiting decisions. The figures reflected agency reports from different dates, primarily in 2025 and early 2026, rather than a single current nationwide count. They also did not identify which awards, if any, involved WSP.
The audit revealed an important difference between agencies. Thirteen of the Department of the Interior’s 19 relevant bureaus and offices reported that reviews had delayed funding approvals or payments. By contrast, officials at the Department of Transportation and two other agencies said they did not believe their review processes had caused delays beyond normal funding timelines. The GAO did not independently determine the timing effects across all agencies. That distinction makes WSP’s experience significant but not necessarily representative of every infrastructure contractor. The company is describing delays encountered by its clients, while government agencies have offered differing assessments of their review procedures.
Transportation and Environmental Projects Are Feeling the Most Pressure
WSP has identified transportation infrastructure and certain Earth and Environment assignments as the American business areas most affected by slower project conversion. These services are closely connected to public investment decisions. Large transportation programs often require preliminary engineering, environmental assessments, planning, design, and construction management before physical work becomes visible. WSP’s business extends across these stages, which means a funding delay can affect several types of professional services associated with the same infrastructure program. Its November 2026 financial outlook specifically identified these two sectors as areas where U.S. organic growth had been weaker than anticipated.
The consequences can extend beyond the engineering companies themselves. A delayed transportation assignment may postpone planning work that local governments need before moving toward construction. For a commuter travelling over an aging bridge or through a congested highway interchange, the underlying infrastructure problem remains even while administrative decisions continue. However, WSP has not publicly identified a comprehensive list of affected contracts or quantified the financial impact of individual delays. It would therefore be premature to conclude that any particular bridge, transit expansion, or highway project has stopped because of the administration’s reviews. The broader concern is the uncertainty surrounding when authorized work can proceed.
The Delays Can Complicate Cash Flow Without Eliminating Demand
Project timing is especially important in engineering because companies must coordinate specialized employees, subcontractors, and resources with the schedules established by their clients. When an expected authorization is postponed, revenue associated with future work may shift into a later accounting period. That can complicate financial planning even when the underlying contract remains intact. L’Heureux has acknowledged that administrative delays are affecting the timing of work and associated cash generation. For WSP, maintaining profitability requires balancing available engineering capacity against the volume of assignments that clients are ready to release.
The company’s reported financial results show why cash-flow trends require careful interpretation. WSP generated $333.2 million in free cash flow during the third quarter of 2026, compared with $314.9 million in the corresponding quarter of 2025. However, free cash flow for the first nine months was $588 million, down from $887.4 million a year earlier. WSP noted that the previous year’s operating cash flow had benefited from a $195 million receivables-factoring transaction. Its days sales outstanding also increased from 71 to 73 days. These figures demonstrate the importance of cash management, but they do not establish that American funding reviews caused the year-to-date decline.
WSP’s Record $20.3-Billion Backlog Suggests Projects Are Still Moving Forward
Despite the American delays, WSP’s order book provides evidence that customers continue to commit to future engineering work. At the end of September 2026, the company reported a record backlog of approximately C$20.3 billion, up 23.5% from the previous year. The backlog represented roughly 11.6 months of revenue, while organic backlog growth reached 5%. In the Americas reporting segment, year-over-year organic backlog growth improved progressively through 2026, reaching 4.9% in the third quarter. These figures suggest that the company’s difficulties involve the timing of project execution rather than a widespread disappearance of contracts.
During the earnings call, L’Heureux also pointed to approximately C$11 billion in the American business backlog and said transportation and infrastructure assignments represented about 13 months of work. The sector’s book-to-bill ratio was approximately 1.2, indicating that new orders were exceeding the volume of work being recognized during the measured period. For investors, these figures offer reassurance, but they also highlight a challenge. A growing backlog is valuable only when projects can progress toward revenue generation. If government approvals remain unpredictable, the company may continue accumulating future work without achieving the pace of execution originally anticipated.
Strong Results in Canada and Overseas Are Helping Offset the U.S. Slowdown
WSP’s diversified international operations have helped prevent the American delays from becoming a company-wide growth problem. During the third quarter, WSP reported C$4.23 billion in net revenue, an increase of 22.1% compared with the previous year. Organic net revenue growth, which excludes certain acquisition and currency effects, reached 5.1%. Canada delivered particularly strong results, with organic growth of 10.2%. Management attributed this performance to transportation infrastructure and activity in energy, mining, defence, and data centres. The company also said it was involved in 68 of Canada’s 100 largest public-sector infrastructure projects.
Outside North America, WSP’s Europe, Middle East, India and Africa segment recorded organic growth of 10.5%. The United Kingdom delivered its fifth consecutive quarter of double-digit organic growth, supported by infrastructure, energy, and data-centre assignments. These results illustrate the advantage of operating across different economies and industries. When transportation funding slows in one country, work involving power networks, industrial facilities, or public infrastructure elsewhere can help sustain revenue. However, geographic diversification does not eliminate all risks. WSP also reported softer activity in New Zealand because of reduced public investment, demonstrating that government spending decisions remain an important influence on engineering demand around the world.
The United States Remains One of WSP’s Most Profitable Markets
Despite the uncertainty surrounding federal funding, L’Heureux has been clear that WSP is not reconsidering the importance of its American operations. During the November 5 earnings call, he described the United States as the world’s largest engineering market and pointed to the company’s strong profitability there. He cited a margin of approximately 22.5% for WSP’s U.S. business, underscoring why the market remains strategically important. American demand also extends well beyond federally supported transportation projects, encompassing private energy investment, electricity transmission, industrial infrastructure, and facilities needed to support growing power consumption.
One example emerged on October 29, when WSP announced that its American subsidiary had been selected as a strategic transmission delivery partner for American Electric Power. The arrangement covers work in Texas, Oklahoma, Arkansas, and Louisiana. AEP is pursuing a broader capital investment program that includes approximately US$37 billion in transmission spending over five years. That figure represents the utility’s planned transmission investments, not the value of WSP’s contract, which was not disclosed. The selection nevertheless demonstrates how expanding electricity infrastructure can create opportunities for engineering firms even while some public projects face delays. WSP sees grid modernization and energy capacity as important long-term sources of American business.
WSP Is Expanding Its Workforce While Carefully Managing Project Timing
The company has continued pursuing acquisitions rather than treating the American slowdown as a reason to stop expanding. Since late September, WSP has completed purchases of Britain’s Hulley & Kirkwood and Australia’s e2m, while also announcing an agreement to acquire Canada’s GCM Corpo. The three businesses collectively represent approximately 780 or more professionals. GCM Corpo alone employs about 600 people and specializes in engineering services for energy, industrial, and mining clients. Its proposed acquisition remained subject to closing conditions, with completion expected during the fourth quarter. WSP’s reported global workforce stood at approximately 85,500 employees at the end of September, compared with 72,400 a year earlier.
Managing that workforce presents a different challenge when contracts are awarded but cannot immediately proceed. During the earnings call, L’Heureux explained that WSP had kept its American transportation and infrastructure workforce around the same size as at the beginning of 2026. He also described the company’s operating costs as largely variable, providing flexibility when project schedules change. That approach can help preserve experienced engineering teams without expanding staffing faster than available work. It also reflects a practical concern: specialized infrastructure professionals are essential when projects accelerate, but maintaining productive teams during uncertain funding periods requires careful coordination. For WSP, the objective is to preserve capabilities while avoiding unnecessary pressure on profitability.
The Next Test Will Be Whether Federal Funding Starts Moving More Predictably
Attention is now turning toward the next stage of American infrastructure funding decisions. Federal surface transportation programs have been temporarily extended through December 11, 2026, giving Congress additional time to negotiate longer-term arrangements. The extension maintains support for certain highway and transportation programs but does not restore new fiscal 2027 advance appropriations under the previous infrastructure law for several major grant programs. L’Heureux has suggested that another extension could provide greater clarity as lawmakers negotiate future transportation funding. However, he has also cautioned that improvement in the company’s American project conversion is likely to occur gradually rather than immediately.
WSP has maintained its overall 2026 financial outlook while narrowing its expected ranges. The company now forecasts annual net revenue between C$16.3 billion and C$16.65 billion, alongside adjusted EBITDA of C$3.11 billion to C$3.15 billion. It expects relatively modest organic growth in its Americas segment but stronger performance in several overseas markets. Management has not yet issued formal guidance for 2027, although it believes it can achieve its previously established 19% adjusted EBITDA margin objective a year early, in 2026. For the months ahead, the critical indicators will be funding authorizations, new work orders, and actual project mobilization. Those developments will determine how quickly America’s considerable infrastructure needs translate into active engineering assignments and revenue for Montreal’s WSP.
