A new immigration stream is coming for Ontario tech workers, but is it necessary?

For Martin Basiri, CEO and co-founder of the Waterloo-based tech company ApplyBoard, his company’s recent growth is a good-news-bad-news situation.

Last year, the company grew from just 35 people to around 140, with the total number of employees now hovering around 170. But they’re not done hiring: Basiri says they still have about 70 open positions.

“Hiring is a big piece for our company to grow,” said Basiri. “High-end leadership positions and some of the similar engineering positions in particular are hard to find.”

According to the province, many tech companies are finding themselves in a similar situation, and the government is stepping in.

Tech talent hard to find, province says

The 2019 budget includes a planned change to the Ontario Immigrant Nominee Program that will create a “dedicated stream to help Ontario’s technology sector attract highly skilled employees” who would be nominated for permanent residency.

“Many tech companies have a need for specific talent to grow their business, which they can’t always find here in Ontario or in Canada,” a spokesperson for the Minister of Economic Development, Job Creation and Trade said in an emailed statement.

The province cited a report from the Information and Communications Technology Council, which says Canada will be short nearly 220,000 skilled workers by 2021.

But in the wake of layoffs at the smart-eyewear startup North, questions remain as to whether there is such a dearth of local employees that more need to be brought in from elsewhere.

CBC News reached out to North for comment on this story, but the company declined.

Who benefits — workers or CEOs?

Numbers from Statistics Canada on tech sector job vacancies locally and provincially paint a complex picture, according to Mikal Skuterud, a professor of economics at the University of Waterloo.

According to the 2016 census, job vacancies in the high tech sector are higher than at the provincial aggregate level, which would support this type of government initiative, Skuterud said.

More recent Statistics Canada data on job vacancies provincially and locally in Kitchener-Waterloo-Barrie show a slight upward trend in provincial vacancies from 2015-2018 — but no explosion in demand, particularly in the local market, Skuterud said.

The number of job vacancies hasn’t meant significant wage growth over the same three year period, and that’s difficult for labour economists to explain.

“If there are truly job vacancies and labour shortages … then what should happen is employers should be competing for the scarce workers, and the way they compete is through offering them higher wages,” said Skuterud.

“So the cynical view of what this program is about is that it’s always in the interest of companies to be in a world in which there are scarce jobs and plentiful workers, as opposed to scarce workers and very few jobs.”

When a labour market is full of workers, prospective employees will compete for jobs by offering to work for less.

This type of immigration program would help foster that sort of environment, Skuterud said.

Remember the dot com crash?

Another possible cause for concern is the dot com crash of the early 2000s, Skuterud said.

In the 1990s, the federal government made a concerted effort to increase the number of high-tech workers through the federal skilled worker immigration program, which led to a “huge increase” in the number of skilled workers, Skuterud said.

“But what happened soon after that huge increase in new immigrants was that there was what was called the dot com crash in the early 2000s,” Skuterud said.

“Those immigrants that came to Canada just before that dot com crash and came with these high-tech skills really struggled and were severely affected by that recession, and so it took them time to adjust.”

Proceed with caution

It’s unlikely that a provincial program will attract the same number of workers as did the federal program in the 1990s, but Skuterud said it’s important for the province to proceed with caution in scaling the program too quickly and to create conditions that will help new immigrants succeed.

“There are challenges, one of them that we often don’t think about is that immigrants often bring spouses,” he said, adding that finding a job for a second professional, say a doctor or lawyer, can often be difficult.

Moving forward, Skuterud said the government should pay close attention to how well immigrants arriving through this program are adjusting.

“We want to monitor how well these workers are doing at finding jobs, and you also want to do everything you can to ensure the local labour markets also support spouses.”

As for Basiri, he said his company has recruited employees from the United States to Brazil and Russia and plans to do more of it.

“We are competing globally, and we need to access global talent,” he said.