The Impact of Processing Delays on Canadian Businesses

Canada is facing a growing skilled labor crunch and industries are struggling to find qualified workers. The increased processing times of immigration pathways is a problem that is closing doors to new growth and leaving employers open to risk.

According to a survey conducted by The Canadian Employee Relocation Council (CERC), “Unless addressed, increasing processing times are likely to have a negative impact on business operations within the next year.”

A total of 26 organizations that rely on access to international talent to meet talent needs and fill skills gaps were surveyed. Participating organizations were from technology, manufacturing, government /health care/ education, natural resources, and construction/engineering services. 44 % of participating organizations report using economic immigration programs to access temporary residence workers.

Primarily, 74% of participating companies used Express Entry and CUSMA professional pathways to hire foreign nationals while 67% used PNP immigration pathways. All participating organizations agreed to the importance of international talent to their businesses, while 70% strongly agreed to their contributions.

In the survey, as an impact of processing impediments 83 % of organizations stated that canceled and or delayed projects are the most common consequence of the delays, almost two-thirds expect the delays to result in lost revenues and 30% stated they had to face penalties for not meeting contractual obligations. The unprecedented labor shortage is forcing organizations to hire ill-suited candidates, resulting in foregone opportunities that impede businesses’ ability to compete.

This lack of skilled labor and halt in the international mobility of temporary foreign workers is increasing the labor market gap, businesses are facing a labor shortage and the demand for skills across many sectors is on the rise. The survey sheds light on global talent access via immigration and international mobility programs, the top three skills accessed are 93% of skilled workers, 85 % executive management, and 67 % engineering staff. Nonetheless, the demand for non-degreed professionals and technical staff is growing, though the lack of education makes it difficult to access their talent.

The survey also highlighted that apart from ongoing challenges faced by IRCC, the continued closure of Consulates, High Commissions and VAC abroad has had a great impact as temporary foreign workers cannot complete biometrics in their home country.

With a dearth of new talent pools and retiring workforce, Canada should take actions to expedite processing of applications. The survey questioned respondents if they would pay an additional fee for expedited processing of applications and 89% of respondents said they would be willing to pay between 10% and 25% above current processing fees for expedited processing as for Skilled labor shortage has become the most pressing need of their organizations.

What makes Canada a great destination for immigrants?

10th largest economy in the world

Canada is a thriving country that claims the 10th largest GDP worldwide, fueled in part by its vast natural resources, significant industrial base, tourist attraction, and vibrant seafood industry. According to Statistics Canada, Canada’s economy is extremely service-oriented, with 78.9% of Canadians working in a service-related job, though it is perceived that Canada is growing due to its natural resources. Though the manufacturing sector is relatively small in comparison to the service sector, it is the cornerstone of Canadian economy, with 68% of its exports constituting merchandise exports.

World-class education system

Canada tops the list as the most educated country in the world. According to the OECD over 56 percent of adults in the Great White North have earned some education after high school. Canada’s high academic standards and rigorous quality controls assure that you will be earning a high-quality education that will open doors for your future and benefit your career over the long term. A Canadian degree, diploma or certificate is globally recognized as being equivalent to those obtained from the United States or Commonwealth countries.

The quality of education and living standards in Canada are amongst the highest in the world, but the cost of living and tuition fees for international students are generally lower than in other countries such as the United States and the United Kingdom. Under Canada’s highly dynamic and hands-on academic environment, you will not only acquire knowledge and skills in analysis and communication, but you will also learn how to express yourself, demonstrate your creativity, and develop your self-confidence.

Canada has world’s top universities, such as McGill University, the University of Toronto, McMaster University, and the University of British Columbia which rank among the world’s top 100 academia.

Booming tech industry

Canada’s evolution over the years as a fount of technology is mirrored by the growth of the Tech sector. Toronto and other parts of Canada have been feasting on tech talent as immigrants are diverting from the U.S. due to stringent immigration policies like temporary suspension of H1B1 Visa which facilitated immigration for thousands of skilled immigrant workers every year. Even during coronavirus outbreak, immigrants in the U.S. faced unusual threat to employment, where in the U.S. is closing doors for immigrants while Canada is attracting an impressive flow of technology jobs and investment.

Tech companies with global footprint are setting up hubs and expanding operations in Canada. The number of tech jobs in Toronto has risen steeply with an increase of 54% from about 148,000 to 228,000 in the past since 2013. Canada certainly displays compelling potential with its mix of talent, technology, and universities together with highly skilled immigrants possessing STEM degrees even before arrival into the country.

Vancouver and Calgary are booming towards clean tech innovation, while Montreal has established itself as a hub for innovation in Artificial Intelligence and game development. Overall, Canada is attempting to attract highly skilled foreign professionals through visa programs like the Global Talent Stream with fast processing time where you move to Canada as quickly as a month as well as provincial tech programs that offer an expedited immigration pathway for people with tech skills .

Multiculturalism and immigration supportive

Over several decades, multiculturalism has evolved from a humanitarian approach to an official policy which became a defining part of Canada’s national identity. Canadian Prime minister Justin Trudeau government’s mantra is “diversity is our strength” which depicts the characteristic Canadian willingness to include various ethnic groups towards the cultural enrichment of Canada.

Canada has been accepting more immigrants per capita than any other developed Western countries. Particularly 310,000 new permanent residents were welcomed by Canada in 2018 and further it is expected that Canada will welcome nearly one million immigrants over the next three years.

In Canada, multiculturalism has always been a form of integration where people respect the diversity of languages, religions, and cultures. Multiculturalism exists when people accept and encourage many cultures to thrive in a society which can be seen particularly in major cities like Toronto, Vancouver, and Montreal. Toronto is one of the most multicultural cities in modern history and this is because of a unique mix of various dominant groups like the British, Irish, Indian, Chinese, Italian and smaller groups like the Dutch, Japanese and Romanians.

Most inclusive country in the world

Canadians have always prided themselves as being open and inclusive. According to Ipsos recently released research, Canada ranks 1st among 25 countries on inclusiveness. Canada stood 2nd on LGBTQ Inclusiveness Score after France as the country has strong support for the LGBTQ community which is evident as Canada became the 4th nation worldwide to legalize same-sex marriage and the first nation outside of Europe in 2015.

Canada actively promotes inclusion and respect for diversity at home and abroad. Establishing equality is a top challenge that the entire human society is facing at the moment, but Canada seems to manage this challenge efficiently in social, economic, cultural, and civic inclusion. In Canada it is apparent that women have a strong voice, along with this basic women’s rights such as voting, birth control access and abortion are long-established and safeguarded in the country.

Universal health-care system

Canada’s health care system has prominent features that distinguish it from virtually all other high-income countries providing universal health care coverage. Firstly, healthcare in Canada is delivered through the provincial and territorial systems called Medicare, which is publicly funded. Canada has one of the world’s highest life expectancy rates and stands at 18th position in the world for life expectancy.

Canadian citizens have the second highest quality of life in the world, according to The World Economic Forum ranking, which ranks countries by quality of life using criteria like access to medical care, sanitation, and shelter, as well as education, life expectancy, and personal freedoms.

Employee entitlements

Canada is exceptional as “provincial law governs annual paid leave, unless the employee falls under federal jurisdiction.” All provinces guarantee two weeks paid vacation, except for three weeks in Saskatchewan. Along with this the employees receive statutory holidays depending on the province.  Canadians also have secured access to a variety of monetary protections including Employment Insurance (EI), old age security, the Canadian Pension Plan (CPP), and a federal childcare benefit.

The minimum wage in Canada ranges from $11 to $15 among different provinces and it stands among one of the highest in the world.  Canadian workers also have access to new family-friendly benefits and progressive workplace policies that allow up to 18 months of parental leave, with the mother and father able to share the leave however they choose.

Beautiful and safe place

The landscapes of Canada range from arctic tundra and BC’s snow-capped mountains, to beautifully desolate prairies and PEI’s rugged coastlines along with interesting architecture in Montreal’s historic buildings. From coast to coast to coast, the country is home to vibrant and culturally rich cities, along with incredible natural wonders.

According to the Global Peace Index of 2018, Canada was ranked the 6th most peaceful nation in the world. Be it protection of citizens on the streets, guarding them against misconduct, or even shielding them against online crime, Canada has done it all. Canada is also known for their strong gun control as they have a comparatively peaceful approach to foreign diplomacy.

Stable democratic political system

The Economist ranked Canada as third-most democratic nation according to its Democracy Index in the year 2006. Canada’s political system is a parliamentary democracy, with its own social and political institutions. Though Canadian governments shift between various liberal and conservative parties depending on the political climate; there is no moral shift as core values and ideologies like women’s and LGBT rights, environmental concerns, and immigration, are shared by the political parties.

Statistics Canada: CEC and PNP immigrants are better in Canadian job market

According to a study conducted by Statistics Canada & IRCC, CEC  and PNP immigrants are fare better than FSWP and QSWP in the job market as they have an edge due to Canadian work experience and pre-arranged employment from working as temporary foreign workers before obtaining permanent residency in Canada.

Economic immigration consists of numerous programs, including the Federal Skilled Worker program (FSWP), Provincial Nominee Program (PNP) and Canadian Experience Class (CEC). These programs help to select permanent residents based on the candidate’s potential ability to perform in the labour market. These programs are administered differently, have separate processes and selection criteria. During the initial years after immigration CEC and PNP immigrants have higher employment rates and earnings than FSWP immigrants although after five years of immigration PNP immigrants have lower earnings than CEC or FSWP immigrants.

Reason why PNP and CEC candidates fair better in Canadian job market?

The temporary foreign workers get a taste of real life in Canada before committing themselves and their families towards moving to Canada permanently by uprooting their lives in their home countries. This helps them to acclimatize in Canadian culture and perform better than other economic immigrants in the country.

In addition, immigrants with Canadian experience have significant benefits in labour market outcomes over immigrants without Canadian work experience, especially when it comes to high earning positions as many temporary foreign workers were international students in Canada who obtained a Post-Graduate Work Permit (PGWP) and have lived in the country for quite a few years before becoming a permanent resident. During this time, they not only improve their language proficiency but also develop the skills the Canadian employers are looking for.

The benefits of studying in Canada are endless, including obtaining a high-quality education, gaining Canadian work experience as well as having improved outcomes after becoming permanent residents of Canada as opposed to candidates from FSWP or QSWP. This is evident as 93% of immigrants selected from the PNP and 95% of immigrants selected from the CEC found employment in the first full year after becoming Canadian permanent residents, while only 80% for candidates under FSWP were employed for the first full year.

After becoming permanent residents in the first full year CEC immigrants earned 56 per cent more than FSWP candidates and this gap diminished over time as in the fifth year CEC immigrants earned 30% more than FSWP  immigrants. Similarly, PNP immigrants also earned higher than FSWP in the first year while by the fifth year their earnings substantially decreased. This is because PNP immigrants tend to have slow earnings growth as they are more likely to be selected for low-skilled or medium-skilled jobs. Nevertheless, FSWP immigrants easily get integrated into the Canadian labour market as they possess essential traits such as high language proficiency and education levels.

Labour market outcomes of Canadian work experience as opposed to pre-arranged jobs

Pre-arranged employment and work experience are among the valuable assets for new immigrants as both are considered as an essential criterion in Canada’s Express Entry system of economic immigration selection. On one hand, pre-arranged employment reflects the employer’s preference more clearly than Canadian work experience. On the other hand, Canadian work experience can better capture the recognized market values of skills than pre-arranged employment.

During the first two years after becoming permanent residents, immigrants with pre-arranged jobs earned 15% more than those without as they had comparative higher income in Canada before becoming permanent residents which is almost double of what immigrants with Canadian work experience earn. Even under Comprehensive Ranking System (CRS) immigration applicants who have a pre-arranged job offer avail 50 to 200 additional points depending on the NOC and seniority of the position offered.

To conclude, prior to immigration, Canadian work experience is a better predictor of immigrant earnings after becoming permanent residents as opposed to having a pre-arranged job.

Toronto becoming the fastest growing tech hub as immigrants choose Canada over the U.S.

Over the years, Toronto has proven it has more offer than its commercial and cultural attractions. It has quietly become the world’s fastest-growing destination for technology jobs, leveraging an immigration policy that is friendly to tech talent.

Silicon Valley has served as a global hub for technology and innovation in the past, but United States restrictive immigration laws are hampering its growth. While Canada’s immigration policy has especially been generous to high-skilled workers in technology.

Toronto and other parts of Canada have been feasting on tech talent as immigrants are diverting from the U.S. due to stringent immigration policies like temporary suspension of H1B1 Visa which facilitated immigration for thousands of skilled immigrant workers every year. Even during coronavirus outbreak, immigrants in the U.S. faced unusual threat to employment, where in the U.S. is closing doors for immigrants while Canada is attracting an impressive flow of technology jobs and investment.

Tech companies with global footprint are setting up hubs and expanding operations in Toronto. The number of tech jobs in Toronto has risen steeply with an increase of 54% from about 148,000 to 228,000 in the past since 2013. Toronto certainly displays compelling potential with its mix of talent, technology, and universities together with highly skilled immigrants possessing STEM degrees even before arrival into the country.

Canada’s evolution over the years as a fount of technology is mirrored by the growth of the Tech sector in Toronto, as nearly 40% or 350,000 Canadian tech workforce comprises immigrants along with 25% of immigrants in the overall workforce.

Immigrants are choosing Canada over the U.S. as these people work in the same time zone, get quick flight for travel, rely on generous Canadian laws, and benefit of Canadian dollar salaries. Canada is attempting to attract highly skilled foreign professionals through visa programs like the Global Talent Stream with fast processing time where you move to Canada as quickly as a month as well as provincial tech programs that offer an expedited immigration pathway for people with tech skills .

Expert talent, high-speed communication, industry-leading research, and development have made Toronto a global hub for IT.  This region has had the fastest growing tech talent pool out of all major North American tech hubs. Between 2,100 and 4,100 active tech start-ups are in the ecosystem, according to a TechToronto report, beating both New York and San Francisco combined. It has even been identified as “the new Silicon Valley”.

Toronto’s technology industry is growing, and it is drawing some of the world’s biggest and brightest technological minds to the city — and many are choosing to stay. Toronto houses numerous innovation centers, start-up accelerators and industry giants including Google, Twitter, and Microsoft. Here is a list of different sectors where plethora of Tech companies are contributing towards turning Toronto into technology epicenter.

Finance

Under this sector companies like FLYBITS are leading contextual customer experience platform for financial sector, retail sector, wealth management and insurance sector. Other companies focused on Fintech sector include SENSIBILL which facilitates a digital receipts ecosystem that allows customers to access receipts directly from their bank accounts which creates stronger relationships among customers and financial institutes.

Education

Company like TOP HAT are focused on Edtech sector, they create higher education teaching app that makes active learning come to life with real time classes. They engage and motivates learners with captivating virtual classroom features, interactive course content and built-in assessment capabilities, partnering with more than 750 universities across North America.

Health

This sector has one of the fastest growing start-ups in Canada, like CAREGUIDE and MAVENCARE which aims at bringing high quality care providers to matching families in need. Careguide matches care seeker sand care providers through websites like CanadianNanny.ca, HeartPayroll.com, Sitter.com, Housekeeper.com, PetSitter.com, ElderCare.com, HouseSitter.com. Other companies like THINK RESEARCH create healthcare software to empower clinics by integrating machine learning with expertise of physicians, pharmacists, nurses, and other medicine practitioners.

Software

Plethora of companies like ACHIEVERS, EVENTMOBI, TAPLYTICS, RUBIKLOUD TECHNOLOGIES, LOOPIO and INFLUITIVE are focused on providing exceptional services by driving profits of global brands with technological assistance and knowledge-based tools to manage big data along with integration with Internet of things and Industry 4.0

Automotive

TRADEREV facilitates an online automotive re marketing system where dealers can launch and participate in real-time vehicle auctions. This company was acquired by KAR Global in 2017 and aims to reinvent the auto industry with its revolutionary vehicle appraisal and auctioning system.

Home Electronics

Canadian home automation company like ECOBEE creates cost effective and energy conservative products like smart thermostats, temperature and occupancy sensors, smart light switches, smart cameras, and contact sensors. Consumers uses thermostat through built-in touchscreen, web portal, or app available for iOS, Android, and the Apple Watch.

Biotech

DEEP GENOMICS is a company working in biotech sector towards transforming AI, biology, and automation in medicine. They are primarily focused on development of oligonucleotide therapies targeting genetic determinants of diseases at RNA and DNA level.

Retail

Retail sector is not left untouched by technology, companies like TULIP are developing platforms to empower retailers by providing a modernize in-store experience for retailers with global footprint like Kate Spade, Bonobos and Saks Fifth Avenue. Another company focused on providing next generation shopping marketplace is FLIPP which empowers users and transforms retail brand businesses.

Half of new skilled immigrants possess Canadian experience

Over the last few years, more immigrants are gaining permanent residence with Canadian work and study experience. As indicated by Statistics Canada, the number of temporary foreign workers and students grew exponentially between the year 2000 and 2018. In 2000, 12% of new economic immigrant principal applicants had worked in Canada before obtaining permanent residency while this share increased to 59% in the year 2018.

The introduction of the Canadian Experience Class (CEC) in 2009 and increasing Provincial Nominee Programs (PNPs) has led to more temporary foreign workers becoming permanent residents of Canada.  In 2018 CEC admitted 20% of all economic-class principal applicants while the Federal Skilled Worker Program (FSWP) and PNPs admitted 25% and 46% respectively.

The advent of Covid-19 pandemic and global travel restrictions have reduced the flow of immigrants to and from Canada, which has increased Canada’s reliability on temporary foreign workers already residing in the country to fulfill their immigration needs. This has also increased the importance of temporary foreign workers in the selection and labour market outcomes of new immigrants in Canada. In 2018, 46% of new economic immigrants were former temporary foreign workers, up from 8% in 2000 according to Statistics Canada.

The “two-step” immigration selection process accounts for the journey of immigrants who arrive in the country as workers or students and then become a permanent resident. In this process

  • Firstly, students or skilled migrants get temporary residence and gain valuable Canadian experience.
  • Secondly, the temporary residents apply for immigration and are selected based on the criteria outlined in Canada’s federal or provincial immigration programs.

This 2-step process improves the match between immigrant skills and labour market demands as employers can directly assess the skills and intangible qualities of the temporary worker. It is evident that the coronavirus pandemic has highlighted potential issues related with dependence on temporary foreign workers, such as labour supply uncertainty, and poor working conditions for employees.

The two-step immigration selection has evolved from 60,000 to 429,300 number of temporary foreign workers between 2000 and 2018.

According to a study conducted by  Statistics Canada, it was discovered that the percentage of new immigrants who were hired in the first full year after immigration rose substantially from 81% to 87% between 2000 to 2016 among men in the age group of 20 to 54 years and among women from 61 % to 67 %. The study also recognized this increase in employment relevant to the growing share of new immigrants with Canadian work experience, who having worked and lived in the country as either temporary foreign workers or international students.

Immigrants who have worked in Canada before immigration had considerable benefits in labour market outcomes over immigrants without Canadian work experience, especially when it comes to high earning positions. Comparably, economic immigrants who landed from 2000 to 2005 and had Canadian experience before immigration earned 4.2 times more than immigrants without Canadian work experience in the first full year after immigration, 2.6 times more in the 5th year, and additional 2.1 in the 10th year.

In a holistic view, immigrants with Canadian experience are finding more employment options and making more annual earnings due to initiatives taken by federal governments in creating more pathways for foreigners with Canadian experience.

Lastly, the COVID-19 pandemic has compelled policymakers to re-evaluate what kind of immigrant workforce the country needs, as people who were previously not considered as highly skilled or essential, are deemed as the frontline workers today.

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