Government Bureaucracy and Red Tape Slowing Tech Growth in Canada

Bringing skilled foreign workers to Canada is often the only way our nation’s fastest growing tech companies can fill critical roles.

Of course, they could resort to poaching employees from other companies within their local tech industry—but this is frowned upon and would break some unwritten anti-poaching agreements between companies that exist today.

Besides, merely moving tech talent around doesn’t result in the net new positions needed to truly grow an ecosystem.

While hiring skilled foreign workers can be a tedious paperwork process; federal rules require companies to complete a labour market opinion (LMO) application demonstrating they are unable to fill the positions with Canadian employees before bringing in foreign workers. It continues to get harder and harder thanks to a few that have put the government’s rubber stampers on high alert.

You may recall the story of the 201 Chinese miners enlisted to work at a BC mine. Or the Royal Bank of Canada’s efforts to hire temporary foreign workers into the country to replace dozens of its own Canadian employees.

Both stories got their fair share of bad press and according to a number of tech companies in Canada (not surprisingly, none of which want to be named in fear of bureaucratic retribution), these “bad apples” have forced Employment and Skills Development Canada to grind the LMO application process to a halt.

An application process that once took on average of seven weeks now takes seven months and is making growing head count on Canadian soil almost impossible. And without a positive LMO, you can’t hire anyone.

While there is hope that changes to the LMO program are coming—their website states that “the program is currently under review to ensure that Canadians always have the first crack at available jobs”—let’s hope the changes aren’t too late.

Many fear that when global tech companies like Facebook, Twitter, and Microsoft set up shop in Vancouver that our Northern soil would just be an Ellis Island for immigrants on their way to a permanent address in Silicon Valley. Others feared the demand for top-notch talent from global tech icons would make it harder for local companies to compete on salaries and perks.

But there may be a bigger problem brewing. In late 2013, Techvibes reported that Amazon was establishing a development office in the new Telus Garden building. The e-commerce company has inked a deal for 100,000 square feet, enough space for more than 1,000 employees. And word on the street is that they’re hiring a dozens of employees every month—but still falling short of their mandate to fill that space.

While Vancouver has a vibrant tech ecosystem, the city does not have the engineer inventory needed to meet Amazon’s demands. Without a consistent flow of new skilled foreign workers, it is only a matter of time before they will have no choice but to poach engineers from the Elastic Path’s and HootSuite’s of the city. And that could end in disaster for everyone.