Canada’s global competitiveness depends on rethinking the work ahead
Canada has long been a strong business hub founded on homegrown resources, be it natural or business supply chain. To become a formidable top tier global innovator, Canada must do more. We must seize the opportunity to capitalize on our country’s unique ability to attract world-class talent through better engaging with our highly educated immigrants from all over the world – and actually putting their skills to real use from day one.
Going beyond the status quo to secure Canada’s competitiveness
We already take great pride in the ubiquitous, nostalgic, feel-good phrase: “Canada is a nation of immigrants”. We must, however, not let all that we have accomplished to date lull us into thinking the status quo is enough to secure Canada’s global competitiveness. Without addressing the realities of current and prospective immigrants once they are here, and pragmatically removing the barriers they continue to face today, that well-meaning sentence is too often reduced to a self-affirming box tick of a job done well; a job wrongfully considered as complete.
Yes, immigration has played a significant role in shaping the Canadian society, economy, and culture. According to the 2021 Census by Statistics Canada, almost a quarter (23.0%) of the population is, or has been, a landed immigrant. The same report also highlighted Canada’s beautiful mosaic of over 450 ethnicities and varied cultural origins, making Canada one of the most ethnocultural and linguistically diverse countries in the world; truly something to be deeply celebrated.
We thus cannot afford to overlook one simple yet undeniable fact: global markets require global thinking, and we have yet to fully tap into our unparalleled resource – our diversity. Canada’s economic prosperity requires our conscious investment in our immigrant founders
The critical key to unlocking Canada’s innovation future is targeted investment in immigrant entrepreneurs
We have top-tier global expertise and talent right here
One of the primary reasons why immigration has been understood as critical to Canada is that it brings in a diverse pool of talent, skills, and experiences. Arguably, we get this from a social standpoint, but we need to understand what this means in business. It comes as no surprise to those paying attention that immigrant entrepreneurs all too often take a back seat when we count how today’s immigrants enrich the Canadian economy.
People are beginning to understand how immigrants bring international perspectives and solutions to Canadian domestic challenges, which can generate new technologies, more-tailored solutions, and broaden services to help accelerate Canada’s growing innovation economy.
The fact is immigrants bring with them a wide range of expertise and education from around the world, which helps them to not only drive economic growth in Canada, but lead innovation here too. The teams they are on get access to their international business networks, established supply chain contacts, and international perspectives on strategic systems.
Unfortunately, this conversation is all too often limited to an employee purview and diversity initiatives alone. Little, if anything, is said about the specific impact immigrant business leaders have as entrepreneurs and founders in their own right.
Even less is said about their economic contributions, or about any of the tailored investment needed to help them build the next generation of Canadian companies. More needs to be done to ensure they are actually seen, heard, and consciously invested in, or we risk losing them outright.
Here’s why we need to invest in immigrant-led businesses now
- Immigrant founders are critical to Canada’s technology and business ecosystems.
We need immigrants to lead innovation, not just to support labour. Sure, Canada’s economic prosperity relies on immigration, but many reduce that concept to meaning only for basic labour roles and entry level positions. It comes up most often in discussions on how to stem the impact of the ongoing labour shortage. However, our immigrants are technological leaders, business creators, and subject matter experts.
In fact, in Canada, first- and second-generation immigrant founders represent just over a third (34.7%) of all early-stage entrepreneurship in the country.
They continue to play a vital role in the growth and success of many industries, especially in technological advancement, right across North America.
Canada’s future global competitiveness heavily depends on the country’s acknowledgment that we have work to do here, and an intentional investment to capitalize on the world-class talent, unparalleled grit, and lived expertise in both domestic and foreign niche markets our immigrant leaders bring to our table.
According to a 2022 report by the National Foundation for American Policy (NFAP), immigrants have started more than half (319 of 582) of America’s startup companies valued at $1 billion or more.
Additionally, nearly two-thirds (64%) of U.S. billion-dollar companies (so-called “unicorns”) were founded or cofounded by first- and second-generation immigrants. Highlighting and building upon these incredible large-scale contributions is vital in securing our nation’s global competitiveness.
- Immigrants are more entrepreneurial and create jobs sooner.
Immigrants are more likely to start businesses than Canadian-born individuals despite being only a quarter of the population. Their efforts are undertaken not just out of sheer necessity on arrival, but often stem from a much deeper-rooted tenacity focused on building a brighter future for themselves as well as their families and communities at large.
A recent study by Statistics Canada showed that immigrant-owned firms in Canada are younger on average than those owned by Canadian-born entrepreneurs, which means they tend to get going sooner, grow faster and have higher rates of job creation.
This makes sense – our immigration system is rigorous, and to make it through the screening and stiff criteria to be here, immigrants must not only be highly motivated, but persistent, resilient, and able to handle a tremendous amount of stress, all while starting over somewhere entirely new. Many immigrants, by their very nature, come here with a deeply personal and necessary entrepreneurial spirit.
As a result, immigrant entrepreneurs represent a critical group of job creators in Canada, by stimulating greater economic activity in their local communities while also contributing to Canada’s overall economic growth.
- Immigrant‑owed businesses are TWICE as likely to export to and grow in global markets.
In Canada, immigrant-led startups and SMEs have a higher export propensity and achieve twice the export growth than Canadian-born led businesses of similar size. This makes immigrant entrepreneurs Canada’s export trade “secret” engine, even though we have yet to fully put that pedal to the metal.
As a trading nation, exporting continues to play a critical role in boosting Canada’s economic growth and creating employment opportunities. Knowing that immigrant entrepreneurs can play a significant role in advancing Canada’s export trade ambitions, targeted support and investment in them should be at the forefront of how Canada builds its capacity for growth.
By simply being born and raised elsewhere, and with a heightened ability to work within the nuances of their own cultural and linguistic communities, immigrant entrepreneurs are generally more global-minded and directly connected internationally.
This helps in identifying new market niches and opportunities that may be overlooked by domestic-focused entrepreneurs. Their experience naturally allows them to more easily diversify export markets and reduce reliance on a single market or traditional trading partners.
The time to invest is now
Our population continues to rely on immigration to grow for the foreseeable future, particularly given the country’s aging population and population growth forecasts. It is paramount that all immigrants are well supported to enable them to meaningfully contribute to their full potential.
From coast to coast to coast, Canada is blessed with world-class immigrants who are a critical part of our population that cannot remain underemployed, underinvested, untapped and stranded.
As the global market for talent remains highly competitive and increasingly transferable, Canada needs to show the world that it is not only the destination of choice for highly skilled immigrants, but where newcomers’ skills and experiences will be fully engaged as part of an inclusive and prosperous Canada.
Bridging the investment capital gap immigrant founders face is vital
Venture capital continues to be instrumental in identifying and harnessing some of the brightest entrepreneurial opportunities to advance technology. An auspicious element to capitalizing on Canada’s growing immigrant population is creating targeted venture capital funds and tailor-made financing vehicles focused on intentional investing in immigrant founders.
This is a critical key to unlocking the next generation of innovation in Canada. If global innovation excellence is to be Canada’s future, then targeted venture capital investment is a crucial way through which we can seize the opportunity of today to build towards that future.
We stand at an important crossroads.
We either target investment capital to support our immigrant founders to usher in the next wave of global innovation or risk losing their expertise, proven tenacity, and unbridled grit to the countries already doing this work.
The choice is clear and highly consequential – Canada’s economic future literally depends on it.