Innovation has long been a hot topic in political circles and board rooms alike, and for good reason. Building innovative businesses has helped us overcome some of the biggest challenges we’ve seen in the 21st century, from economic crises to the COVID-19 pandemic. Innovation has allowed us to adapt to new ways of living and working, and created opportunities for positive change in our social, political and business landscapes.
While it can seem like a buzzword sometimes, innovation is fundamentally an ongoing process of developing new and better techniques, products and business practices. In a globalized economy, innovation is the only real way to remain competitive and drive economic growth and prosperity. As we emerge from an unprecedented global emergency, we find both a need and an opportunity to bolster Canada’s innovation landscape.
Specific policies start with understanding the challenges that businesses encounter every day. Through Deloitte’s Technology Fast 50 program, and from members of the Council of Canadian Innovators (CCI), we hear directly from the leaders of Canada’s fastest growing scale-ups about their key challenges. These include attracting and retaining top talent, commercializing products and services, and expanding internationally. Now that parliament has resumed after the 2021 federal election, there are opportunities for government to continue making meaningful progress in addressing these challenges.
Canada’s economy needs talent for innovation. Over the last three years, 40 per cent of Fast 50 CEOs have struggled with the availability of talent, a situation that the COVID-19 pandemic has only exacerbated. Remote work has increased poaching by international companies, hollowing out the ability of Canadian firms to retain top talent. Public policy interventions are needed to urgently address this gap, including clearing the pandemic-induced visa backlog and building a streamlined digital immigration system that will be resilient in future crises.
Equally important is Canadian workforce development, which could be supported by developing a Canadian-based pipeline of technical and managerial talent. Skill-building programs, as well as offsets for hiring costs of new employees for strategic roles where Canadian scale-ups experience key gaps, could both play a role.
The shortage of skilled talent links with another concern from Fast 50 CEOs: product development and commercialization. Innovative companies working in the knowledge economy rely on human ingenuity both to develop innovative ideas and successfully bring them to market. Fast 50 participants consistently rank the development of new products and services among the top three pathways for growing their companies, but it is also among their top three challenges.
According to the Information Communications Technology Council, the Canadian economy will have a demand for an additional 250,000 jobs by 2025. If companies can’t find those skilled workers, it limits their ability to develop products and services.
Additionally, there is an opportunity to look at improvements to help companies generate and protect their intellectual property (IP). IP ownership is linked to higher scale-up growth. But when the CCI surveyed our members in January 2021, we found that 45 per cent of our companies own zero patents. This isn’t because chief executive officers don’t understand the value of IP nor is it because they’re not generating innovative ideas and techniques that could be protected. But focusing on driving growth, recruiting talent, product development, fundraising and other concerns sometimes leaves IP as an afterthought.
Mechanisms like patent pools, which allow participants to share patent resources and protection, and best practices for technology transfer offices, which support commercialization of academic research, are critical. During the 2021 federal election we saw some politicians propose “patent box” tax structures, and even subsidies that would pay for the first five patents a company files. Now that MPs are back on the job discussing policy, all these ideas should be on the table.
It would also be in Canada’s best interest to ensure that our high-growth technology companies are successful on the global stage. This, too, is a top-three growth avenue for Fast 50 participants, especially for smaller firms. Strategies to help scale-ups leverage Canada’s international trade infrastructure, like exporter-in-residence mentorship programs, are needed, as well as updates to data residency and privacy rules that would allow Canadian companies to operate internationally with confidence.
While only a few of these challenges have been highlighted here, a deeper dive into this growing opportunity area is outlined in Deloitte’s public policy brief, Innovation at scale: Establishing Canada as a global leader. This report provides further insight into how leaders of Canada’s high-growth companies are looking to navigate the future, and how governments might continue to support our country’s innovation landscape.
Just as importantly, further insight can be found through direct conversations with innovation practitioners and CEOs – experts doing the hard work to build innovative, high-growth 21st century businesses in Canada.
We should embrace the opportunity for government and business to work together in our pursuit of innovation in the future, starting with an immediate focus on talent and people. Now is the time to put Canada on a path to prosperity and innovation leadership in the decades to come.
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OTTAWA – Canada’s unemployment rate held steady at 6.5 per cent last month as hiring remained weak across the economy.
Statistics Canada’s labour force survey on Friday said employment rose by a modest 15,000 jobs in October.
Business, building and support services saw the largest gain in employment.
Meanwhile, finance, insurance, real estate, rental and leasing experienced the largest decline.
Many economists see weakness in the job market continuing in the short term, before the Bank of Canada’s interest rate cuts spark a rebound in economic growth next year.
Despite ongoing softness in the labour market, however, strong wage growth has raged on in Canada. Average hourly wages in October grew 4.9 per cent from a year ago, reaching $35.76.
Friday’s report also shed some light on the financial health of households.
According to the agency, 28.8 per cent of Canadians aged 15 or older were living in a household that had difficulty meeting financial needs – like food and housing – in the previous four weeks.
That was down from 33.1 per cent in October 2023 and 35.5 per cent in October 2022, but still above the 20.4 per cent figure recorded in October 2020.
People living in a rented home were more likely to report difficulty meeting financial needs, with nearly four in 10 reporting that was the case.
That compares with just under a quarter of those living in an owned home by a household member.
Immigrants were also more likely to report facing financial strain last month, with about four out of 10 immigrants who landed in the last year doing so.
That compares with about three in 10 more established immigrants and one in four of people born in Canada.
This report by The Canadian Press was first published Nov. 8, 2024.
The Canadian Institute for Health Information says health-care spending in Canada is projected to reach a new high in 2024.
The annual report released Thursday says total health spending is expected to hit $372 billion, or $9,054 per Canadian.
CIHI’s national analysis predicts expenditures will rise by 5.7 per cent in 2024, compared to 4.5 per cent in 2023 and 1.7 per cent in 2022.
This year’s health spending is estimated to represent 12.4 per cent of Canada’s gross domestic product. Excluding two years of the pandemic, it would be the highest ratio in the country’s history.
While it’s not unusual for health expenditures to outpace economic growth, the report says this could be the case for the next several years due to Canada’s growing population and its aging demographic.
Canada’s per capita spending on health care in 2022 was among the highest in the world, but still less than countries such as the United States and Sweden.
The report notes that the Canadian dental and pharmacare plans could push health-care spending even further as more people who previously couldn’t afford these services start using them.
This report by The Canadian Press was first published Nov. 7, 2024.
Canadian Press health coverage receives support through a partnership with the Canadian Medical Association. CP is solely responsible for this content.
As Canadians wake up to news that Donald Trump will return to the White House, the president-elect’s protectionist stance is casting a spotlight on what effect his second term will have on Canada-U.S. economic ties.
Some Canadian business leaders have expressed worry over Trump’s promise to introduce a universal 10 per cent tariff on all American imports.
A Canadian Chamber of Commerce report released last month suggested those tariffs would shrink the Canadian economy, resulting in around $30 billion per year in economic costs.
More than 77 per cent of Canadian exports go to the U.S.
Canada’s manufacturing sector faces the biggest risk should Trump push forward on imposing broad tariffs, said Canadian Manufacturers and Exporters president and CEO Dennis Darby. He said the sector is the “most trade-exposed” within Canada.
“It’s in the U.S.’s best interest, it’s in our best interest, but most importantly for consumers across North America, that we’re able to trade goods, materials, ingredients, as we have under the trade agreements,” Darby said in an interview.
“It’s a more complex or complicated outcome than it would have been with the Democrats, but we’ve had to deal with this before and we’re going to do our best to deal with it again.”
American economists have also warned Trump’s plan could cause inflation and possibly a recession, which could have ripple effects in Canada.
It’s consumers who will ultimately feel the burden of any inflationary effect caused by broad tariffs, said Darby.
“A tariff tends to raise costs, and it ultimately raises prices, so that’s something that we have to be prepared for,” he said.
“It could tilt production mandates. A tariff makes goods more expensive, but on the same token, it also will make inputs for the U.S. more expensive.”
A report last month by TD economist Marc Ercolao said research shows a full-scale implementation of Trump’s tariff plan could lead to a near-five per cent reduction in Canadian export volumes to the U.S. by early-2027, relative to current baseline forecasts.
Retaliation by Canada would also increase costs for domestic producers, and push import volumes lower in the process.
“Slowing import activity mitigates some of the negative net trade impact on total GDP enough to avoid a technical recession, but still produces a period of extended stagnation through 2025 and 2026,” Ercolao said.
Since the Canada-United States-Mexico Agreement came into effect in 2020, trade between Canada and the U.S. has surged by 46 per cent, according to the Toronto Region Board of Trade.
With that deal is up for review in 2026, Canadian Chamber of Commerce president and CEO Candace Laing said the Canadian government “must collaborate effectively with the Trump administration to preserve and strengthen our bilateral economic partnership.”
“With an impressive $3.6 billion in daily trade, Canada and the United States are each other’s closest international partners. The secure and efficient flow of goods and people across our border … remains essential for the economies of both countries,” she said in a statement.
“By resisting tariffs and trade barriers that will only raise prices and hurt consumers in both countries, Canada and the United States can strengthen resilient cross-border supply chains that enhance our shared economic security.”
This report by The Canadian Press was first published Nov. 6, 2024.
