To say the world has had a tough year would be an understatement. But Canada’s innovation economy provided a silver lining for the black clouds that dominated 2020.
Faced with a pandemic and the worst economic conditions seen in a generation, the people and young companies at the foundation of this country’s technology sector have managed remarkably well — even thrived. Canadian unicorn companies are multiplying. Eleven of our companies made the Global Cleantech 100. The domestic biotech sector had its best funding year ever. There will always be challenges, but this resilience bodes well for Canada’s economic future in 2021 and the decade beyond.
To prepare for this future, Ryerson University’s tech startup accelerator, DMZ, joined a coalition of innovation hubs, institutions, entrepreneurs, investors and corporate partners to shed light on key questions and trends. The result was a series of data-driven reports on the major issues facing Canada’s tech ecosystem.
To me, what stood out in these reports was the resilience of our ecosystem. Here are five key findings from the Innovation Economy Council’s reports on Canadian tech in 2020:
Tech jobs are still growing
Despite the pandemic’s terrible economic toll across the economy, there are now nearly 100,000 more jobs in STEM disciplines — science, technology, engineering and math — than there were before COVID-19.
The rest of the economy has lost more than 400,000 jobs, leaving a gaping hole in Canada’s employment market. But not for STEM workers, who include many of our best and brightest.
Employers quickly pivoted to remote work, raised fresh capital, seized new opportunities … and continued hiring. That includes tech companies and startups involved in software development, artificial intelligence, clean technology and the digital delivery of products and services.
Tech growth is outpacing other sectors
The technology sector is creating more jobs than the rest of the economy because it’s providing solutions to some of society’s greatest challenges: discovering new medical treatments, helping to slow climate change, combating cyberthreats, promoting digital transformation.
Companies involved in computer systems design have added nearly 90,000 jobs since 2009 — three times as many as the entire vehicle manufacturing and auto-parts sectors. In Ontario, GDP in the fast-growing software industry has expanded six times faster than the overall economy.
The business of making things is moving up the evolutionary ladder
There is a mistaken impression that Canadian manufacturing is dying, but that’s not the case. Technology is saving factories by allowing them to produce more with fewer lower-skilled workers. As a result, a clutch of advanced manufacturing sectors is contributing an outsized share of factory job creation and economic growth.
These manufacturers are categorized as advanced because they spend more on research and development and employ higher-skilled workers. In Ontario, advanced manufacturing generated half of the more than 45,000 factory jobs created since 2010. And these workers earn 50 per cent more than the national average.
Canada is holding its own in the talent race
It’s part of the Canadian psyche to believe that things must be better somewhere else, especially the United States. People are sometimes under the incorrect assumption that universities are superior or job opportunities are more fulfilling there. So talented people leave.
But that traditional brain drain has largely been reversed, based on an IEC examination of the flow of people in and out of the country. Talent flows both ways, but the data suggests that Canada is gaining more STEM talent than it’s losing.
Thousands of Canadians continue to pursue careers and education in the United States, despite years of anti-immigration rhetoric and stricter visa rules. Research by the IEC shows that more than 10,000 Canadians went south in 2019 on U.S. green cards and H-1B visas, a favoured entrée for skilled tech workers. But continuing a pattern of recent years, Canada also attracted nearly 23,000 STEM workers from other countries through permanent residency and temporary foreign worker visas.
There are also signs that tens of thousands of the roughly three million Canadian expatriates living abroad returned home when the pandemic hit, many of them for good. That’s helping to fill up Canada’s talent pool.
Students are embracing STEM
Young Canadians are getting the message that their job prospects are better in the new economy. Canadian enrolment in STEM disciplines is growing faster than for all other post-secondary programs.
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More than one in three college-bound graduating high school students are choosing STEM programs. Between 2014 and 2018, STEM enrolment grew 16.4 per cent, paced by a nearly 50-per-cent increase in students entering math and computer science.
The knowledge sector’s share of the workforce was on a steady upward path before the pandemic; STEM and related science-and-technology jobs made up 34 per cent of the workforce in 2018, up from 28 per cent in 2000. And that trend has continued in the past year.
These are all causes for hope and optimism about Canada’s surging tech sector, even as we say good riddance to the pain and suffering of 2020.
