While Toronto may have lost out on the Amazon HQ2 decision, there is more than it – and other Canadian cities – can do to become more attractive to the global tech sector.
A report from CBRE says that, despite being popular tech locations, Canadian cities are lagging when it comes to the development and promotion of ‘tech clusters’.
“Toronto’s inclusion on Amazon’s HQ2 shortlist thrust Canada’s tech market into the spotlight. While our market is growing and is dynamic, our analysis suggests that tax incentives aren’t the only thing holding our cities back when competing for global tech investment,” commented Paul Morassutti, Vice Chairman at CBRE Canada.
He added that tech clusters are essential to attracting large investments from global tech leaders, but they don’t happen overnight, or without collaboration between stakeholders.
“Concerted effort, policy and infrastructure from all levels of government, business leaders, venture capitalists, and research and academic centres is required to attract and retain high-tech firms and support connectivity between them,” said Morassutti.
The cities that are performing well
Many Canadian cities are performing well in attracting the tech sector.
The top five Canadian tech talent markets in 2018 are Toronto, Ottawa, Montreal, Vancouver and Waterloo-Region, with Montreal replacing Vancouver in the top three. This is due to Montreal’s overall tech talent and high-tech concentration outpacing that of Vancouver’s for a second consecutive year.
CBRE’s scorecard includes 20 cities and shows that new entrants performed well, with Quebec City, Hamilton and Victoria surprisingly rounding out the top 10. Quebec City has a strong concentration of tech talent that’s above the national average, while Victoria and Hamilton feature high quality, well-educated labour forces at a moderate cost to employers.
Canadian cities added 178,800 tech jobs between 2012 and 2017, an increase of 27.3%, 57,600 of which were added in 2017 alone. Oshawa was the fastest-growing city with a 71.4% growth over the 5-year period.
“No matter the size of the market, there are advantages to operating in Canada. Large markets tend to have a deeper pool of talent, while smaller markets attract talent with more competitive business and living costs,” commented Morassutti. “Tech, which now accounts for 23% of all office space demand in Canada, has driven rents up and vacancy down. Costs may be rising, but we are relatively affordable compared to other global cities and paying to be close to quality talent is a small trade-off for well-resourced tech companies.”