In recent years, conversations had been circling in various communities about the ever-growing tech sector in Saskatchewan, discussing successful start-ups such as 7Shifts to the challenge of accessing a tech talent pool. That growing interest prompted SaskInteractive to explore talks in early 2019 with Western Economic Diversification Canada and Innovation Saskatchewan to support and fund a tech sector study.
| The definition of the tech sector used in the study looks at tech companies as well as tech occupations employed in non-tech industries. Nordicity found, based on early 2010 statistics, that there has been a significant increase in tech employment as tech occupations have come to represent increasingly critical functions across all industries, even those which are not typically associated with “tech.” |
That partnership formed a steering committee of tech companies, government, and private companies to strategize a set of objectives for data research and analysis and report on the economic impact of the tech sector on the provincial economy. SaskInteractive engaged a national transparent tender process and negotiated a contract with Nordicity as the successful vendor. The contract work began in April 2019, and the study was released on May 21, 2020.
The Labour Market and Economic Impact (LMEI) Study highlights some impressive facts and data analysis, which is a good baseline for the province and the sector to use. Three key facts emerged from the work:
- People working in tech occupations earn 43 per cent more than the average worker in Saskatchewan, with an average salary of $76,000,
- Saskatchewan tech companies generated over $10.2 billion in revenue in 2018 and represent 5.6% of Saskatchewan’s total gross domestic product, and
- The tech sector had a $1.3-billion total fiscal (tax) impact.
Also in Nordicity’s analysis, growth in new workers during this period was most prominent among young and older age groups. The greatest percentage growth was seen among people in their 20s and those over 45, meaning that both younger technical workers and more experienced managers continue to be in high demand among Saskatchewan companies.
Nordicity’s findings of the ‘core’ tech sector has shown particularly good progress since 2010, as evidenced by success stories such as Vendasta, Lumeca, Mentor (A Siemens Company) and 7Shifts—all of which call Saskatchewan home. From 2015 to 2018, the ‘core’ tech industry grew by 19 per cent, adding nearly 1,000 workers. Within this total, a group of selected high-growth companies realized a 250 per cent increase in employment over the same period. The high growth tech companies should continue to drive exceptional employment growth, develop talent, and create a culture of innovation on which to build the next generation of high growth companies.
The numbers certainly draw attention to the importance of the province’s tech sector, both as a contributor to Saskatchewan’s economy and provincial treasury, and a driver of high-quality job creation in the province.
One potential bottleneck identified in the report is the availability of financing for promising start-up companies. Over the past few years, meeting this challenge has been a priority for stakeholders in the sector, including government and industry associations. In that context, these numbers suggest that there is potentially a significant payback on these continuing efforts to support tech start-ups.
Another challenge for Saskatchewan’s tech sector is accessing talent. Compared to many of the major tech centres, the cost of living in Saskatchewan is much lower relative to what tech workers earn. This finding represents an advantage for both companies and tech workers that choose to locate within the province—companies will have lower payroll costs than they would in other jurisdictions and employees will enjoy a higher quality of life. Naturally, the availability of talent will be a key enabler to continue the growth that we have seen in the recent past.
That said, the tech talent crunch is a global phenomenon, and it is already upon us. From a strictly economic perspective, the comparatively high compensation enjoyed by tech workers is a natural result of a high demand for talent against a limited supply of qualified workers.
Although it is tempting to focus on bringing new workers to the province, 88 per cent of Saskatchewan’s tech workers [in 2015] were people who lived in the province in 2010. Moreover, companies reported that 75 per cent of new hires are currently from within the province, so the tech sector in the province (and its success) is largely homegrown.
During the study’s public engagement, tech workers were quick to point out the importance and difficulty of staying up to date on current and emerging technologies. Therefore, training and continuing education is more than just occupational readiness for junior workers—it is a dynamic and ongoing process in all tech occupations.
As such, it is critical for Saskatchewan tech sector stakeholders to cultivate the local training infrastructure needed to support the growth and continued development of workers at both tech-focused companies as well as in the R&D and IT roles required to support competitiveness in non-tech industries.
To learn more about the LMEI study, visit saskinteractive.com/lmei