11 Dec (Business in Vancouver) Tech growth plan could pay huge dividends for BC
BC’s tech industry is underperforming other tech regions in Canada
By Harry Jaako
Technology is B.C.’s Rodney Dangerfield industry. It just doesn’t get any respect.
The financial media always refer to Canada as a resource-based country, Christy Clark’s Liberals are obsessed with jobs, jobs, jobs and economic growth – in the resource industries in the north.
But most British Columbians don’t know the economic facts about the province’s tech industry.
In 2012, tech employed 84,000 people. That’s more than forestry, mining and oil and gas combined. It was also the second fastest private-sector job creator over the previous decade and the third largest contributor to B.C.’s GDP – up from No. 6 a decade ago. Tech generated $18 billion in revenue, growing at double B.C.’s overall growth rate. And who knows that the tech industry had $4.1 billion in exports, or 10% of all B.C. exports, doubling since 2001?
But perhaps most importantly, did you know that the tech industry had an annual payroll of $5.3 billion, with an unemployment rate of only 1.9% and jobs that pay 50% more than the B.C. average?
However, the BC Technology Industry Association (BCTIA) is worried. It’s worried that B.C.’s tech industry, at 5.9% of B.C.’s GDP, is underperforming other tech regions in Canada, which overall for the country contribute 7.5%. If B.C. were performing to the same level as Canada in total, it would mean incremental annual industry revenue of $5.1 billion, incremental GDP of $2.5 billion, an additional 23,000 jobs and incremental payroll of $1.4 billion for B.C. But the BCTIA’s bigger worry is that the global tech opportunity is growing at 7.4%, much faster than B.C.’s. If B.C. takes “decisive and deliberate action” to match global growth levels, the province’s tech industry could potentially exceed $50 billion in revenue, employ 142,000 workers and account for $18 billion in exports by 2020, according to the BC Business Council’s Opportunities BC 2020 report.
To return B.C. to the front of the tech class, the BCTIA is advocating its new four-point plan for growth.
- Double the level of venture capital investments in B.C.
Double the size of the angel tax credit program by encouraging the federal government to adopt and financially support it nationally and get the B.C. government to invest an additional $100 million of capital annually into venture capital that would be leveraged 3:1 with private investment, and look into equity crowd-funding for startups and entrepreneurs.
- Invest in talent attraction and training
Accelerate foreign worker approvals through the provincial nominee program, increase the number of graduates from post-secondary science/technology programs, expand the B.C. training tax credit program to include co-op and internship placements, and support industry in the delivery of strategic talent attraction and retention initiatives.
- Leverage procurement to foster a home team advantage for B.C. tech companies.
Use the federal industrial and regional benefits program to support B.C. technology companies, institute a pre-commercial technology adoption program, introduce set-asides in procurement for SMEs across government, agencies and Crown corporations.
- Invest in building company capacity
Provide financial support to industry-driven, capacity-building programs that deliver measurable results through real company growth and the creation of new jobs.
I wish the BCTIA success in turning around the Rodney Dangerfield image of the industry. After all, it should be easier for governments to politically respect, and financially support, this industry that has such strong proven performance over the past decade, and a credible shot at much better performance with proper decisive and deliberate action to give it the boost it needs.
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