In today’s fast-changing world, having talented people is super important for a country’s success. Well, Canada is a place where lots of smart and skilled folks gather.
Canada’s got a diverse group of workers, top-notch schools, and rules that help it get the best people. This makes it a top choice for HR professionals and businesses. We’re going to look at some facts and numbers that show how Canada’s talent scene works. From its growing tech scene to its skilled workers in different jobs, Canada is the place where people from all over the world come to work and bring new ideas.
Canada has a highly educated and skilled workforce, with a strong emphasis on STEM (Science, Technology, Engineering, and Mathematics) fields. Canada has a welcoming immigration policy, which contributes to a diverse and skilled workforce. Thus, the labor force is diverse, with a mix of both Canadian-born and immigrant workers, contributing to a rich talent pool. The workforce is generally well-educated, and the country offers various training and development programs to upskill employees.
Canada’s labor force participation rate was approximately 65.2% as of 2020. Immigrants make up a significant portion of the workforce, almost one fourth, with approximately 23.1% of the population being foreign-born in 2019. Especifically, Express Entry is a popular immigration system that prioritizes candidates with high skills and education levels. This system selects skilled immigrants based on a Comprehensive Ranking System (CRS) score. In 2021, Canada invited 114,431 candidates through this system, whereas in 2022, they issued 46,539 invitations, which is a 59% decrease from the previous year. However, Canada aims to admit over 1.2 million immigrants between 2021 and 2023.
Canada has a robust education system with world-renowned universities and colleges. It prioritizes research and innovation, producing a steady stream of talent in various fields. The IMD ranks Canada 8th in the world in terms of the competitiveness of its workforce. This is due to the fact that the labor pool here is highly skilled and educated, yet more economical than in the US.
The country’s immigration policies also attract international students, further enriching the talent pool. It consistently ranks among the top countries for the quality of its education system, according to the OECD. And, Canada is home to over 96 universities and more than 150 colleges. So, the country consistently sits near the top of the charts when it comes to its citizens’ attainments; 63% of Canadian residents aged 25 to 34 have completed degrees or certificates, making it one of the countries with the highest percentage of nationals with post-secondary education.
From another perspective, Canada’s gross domestic expenditures on research and development for 2021 indicate that spending declined 1.4% to $40.1 billion. This decrease was driven by an 8.7% reduction in funding by the federal government, which follows a slight increase of 0.7% in 2020, which was also mainly attributed to the federal government.
Key business trends
- Digital transformation
- Canadian businesses have been accelerating their digital transformation efforts. The COVID-19 pandemic accelerated this trend as companies adopted remote work, e-commerce, and digital marketing strategies.
- Investments in technology and automation have increased, enhancing efficiency and competitiveness.
- Sustainability and green initiatives
- Sustainability has become a significant focus for Canadian businesses. There’s a growing emphasis on reducing carbon footprints and adopting eco-friendly practices.
- Companies are investing in renewable energy, green technology, and sustainable supply chain management. In nominal terms, the ECT sector in Canada was valued at $73 billion in 2021. This represents about 2.9% of Canada’s economy, a share that has remained relatively stable since the start of the data series in 2007.
- Technology and innovation
- Canada’s technology sector is booming, particularly in cities like Toronto, Vancouver, and Montreal. It’s an emerging hub for AI, fintech, and software development.
- Research and development (R&D) investments are increasing, with companies partnering with universities and research institutions to drive innovation. In fact, the technology sector in Canada contributed over $104.5 billion to the country’s GDP in 2021.
- Canada’s ECT sector’s real GDP increased, indeed, by 21% over 2012 to 2021, significantly outpacing the 15% growth recorded by the overall Canadian economy over the same period.
- Remote work and flexible work arrangements
- The pandemic changed the way Canadians work. Many companies are embracing remote work and flexible work arrangements as a long-term strategy.
- This trend is impacting office space requirements and redefining workplace culture.
- E-commerce and online retail
- E-commerce experienced significant growth during the pandemic, and it continues to thrive. Canadian businesses are investing in online platforms and improving their digital shopping experiences.
- Logistics and last-mile delivery services are also evolving to meet the demands of online shoppers.
- Healthcare and biotechnology
- The healthcare and biotechnology sectors have gained prominence due to the pandemic as well. Canadian businesses are investing in medical research, pharmaceuticals, and healthcare technology.
- Telemedicine and remote patient monitoring have seen substantial growth.
- International trade and export
- Canada is a trading nation, and businesses are actively exploring global markets. Trade agreements, such as the United States-Mexico-Canada Agreement (USMCA) which came into force on July 1, 2020, facilitate international commerce.
- E-commerce is playing a pivotal role in expanding Canadian businesses’ reach beyond domestic borders.
- Diversity and inclusion
- Canadian businesses are increasingly focusing on diversity and inclusion in their workforce and corporate culture.
- Initiatives to hire and promote diverse talent are becoming more common, aligning with the country’s multicultural society.
Canada’s economy is resilient, characterized by a mix of industries including natural resources, manufacturing, and services. In fact, economic growth is influenced by global factors, such as trade agreements and commodity prices. According to the latest World Bank annual ratings, it ranks 23rd out of 190 economies for ease of doing business. It is one of the most attractive OECD countries for highly qualified workers and comes out as the most attractive OECD country for entrepreneurs. Plus, the government often introduces economic stimulus measures to support growth during economic downturns.
The International Institute for Management Development (IMD) ranks Canada 14th globally for its overall economic competitiveness, and the country’s growth rate ranged from 1%-3% in the decade leading up to 2020. Unemployment rates are low and minimum wages are rising. A combination that tends to result in high levels of disposable income. Trade freedoms, low corporate taxes and a stable political environment make it a secure and reliable economy.
Regarding GDP, Canada’s was approximately $1.64 trillion in 2020, making it the world’s ninth-largest economy. The country experienced a recession in 2020 due to the COVID-19 pandemic, with a GDP decline of 5.4%, but rebounded with 5.6% growth in 2021.
Exports play a crucial role in the economy, accounting for about 30% of GDP. In 2021, Canada’s annual exports reached a record $637 billion, exceeding the previous record set in 2019 by 7.0%.
Incentives for foreign investors & entrepreneurs
Canada is known for its political stability, strong legal framework, and transparent business environment, which are attractive to foreign investors seeking security and predictability. Hence, Canada offers various incentives to attract foreign investors and entrepreneurs. These programs are designed to stimulate economic growth, innovation, and job creation. Such as the Start-Up Visa Program:
- The Startup Visa Program is a popular option for foreign entrepreneurs looking to establish innovative businesses in Canada.
- To qualify, entrepreneurs need a commitment from a designated Canadian investor or venture capital fund.
- Successful applicants receive permanent residency, allowing them to operate their startups in Canada.
- In fact, attracted over 6.3% more immigrant entrepreneurs in first half of 2023 compared to last year.
Another program is the Provincial Nominee Programs (PNPs), which allow provinces to nominate individuals for immigration based on their investment or business plans. They have welcomed thousands of investors and entrepreneurs, with specific criteria varying by province. And many provinces in Canada have PNPs that allow them to nominate foreign entrepreneurs and investors for permanent residency.
Regarding tax incentives and tax benefits, Canada offers the following:
- Investment tax credits:
- Various provinces in Canada offer investment tax credits to encourage investment in specific sectors, such as research and development, clean technology, and film production.
- These tax credits can significantly reduce the tax burden for investors in eligible industries.
- Research and Development (R&D) tax incentives:
- Canada provides generous tax incentives to businesses engaged in R&D activities. The Scientific Research and Experimental Development (SR&ED) program is a federal program that provides tax credits for eligible R&D expenditures.
- These incentives can help businesses recover a portion of their R&D costs, making Canada an attractive location for innovation-driven enterprises.
- Scientific Research and Experimental Development (SR&ED) tax incentive program:
- Providing over $3 billion in tax incentives annually.
- Foreign Trade Zones (FTZs):
- Foreign investors can benefit from establishing their businesses in designated Foreign Trade Zones. These zones offer advantages such as customs duty exemptions and streamlined regulatory processes.
- Strategic Innovation Fund (SIF):
- The Strategic Innovation Fund provides financial support to innovative businesses in Canada. It aims to help companies scale up, innovate, and create jobs.
- Plus, the fund supports projects in various sectors, including clean technology, aerospace, and manufacturing.
- Angel investor tax credit:
- Some provinces, like British Columbia and Nova Scotia, offer tax credits to angel investors who invest in eligible startups. This, in fact, encourages individuals to support early-stage companies.
- Accelerated Capital Cost Allowance (CCA):
- The Accelerated CCA allows businesses to deduct a larger portion of their capital costs in the year they are incurred, reducing taxable income.
In conclusion, Canada presents a robust business landscape characterized by a convergence of emerging trends and established proficiency. In fact, it boasts a diverse and skilled workforce nurtured by an exceptional education system, underpinned by a strong focus on sustainability and innovation.
Digital transformation, sustainability initiatives, and technological advancements are reshaping the Canadian business landscape, while remote work and e-commerce continue to redefine traditional paradigms. These trends, coupled with Canada’s stable environment, create an environment ripe for investment and entrepreneurial endeavors.
Moreover, Canada’s incentives and tax benefits for foreign investors and entrepreneurs, including the Startup Visa Program and investment tax credits, underscore its commitment to fostering economic growth and innovation. This combination of talent, trends, and incentives indeed positions Canada as a premier destination for those seeking business opportunities in a forward-thinking and diverse environment.
In summary, Canada’s thriving business ecosystem embodies a harmonious blend of innovation and proficiency, offering a wealth of prospects for HR professionals, investors, and individuals aspiring to be part of a dynamic and inclusive business community.
If you liked the article and are more interested in salary information, compensation and benefits packages, talent trends, and more… check out our salary platform for free!