Going, Going, Gone...(Part I)

Canada's "Brain Drain" Expatriates Speak Out!

For best results, this document is available in PDF format.

Is there a Brain Drain?

Vigorous debate continues as to whether or not Canada is experiencing a bona fide 'brain drain'.

The main disagreement does not seem to be around whether or not there is a southward migration of skilled workers. A Statistics Canadaⁱ study shows that Canada has suffered over the last decade a net – and increasing – loss of skilled workers to the United States in several economically important occupations. Compared with the general population, these workers who have left Canada are more likely to be better-educated, higher-income earners and individuals of prime working age. Another recent study released by Industry Canada supports the findings of southward migration.

Propositions put forward by the studies, however suggest that the magnitude of the problem is offset by only being a temporary migration (it is expected that most individuals will return to Canada) and that the influx of skilled workers into Canada from the rest of the world is increasing, particularly in high-technology industries where immigrant workers entering Canada outnumber the outflow to the United States by a wide margin.

As such, the heated debate seems primarily focussed on what magnitude of migration must be reached before the official status of 'brain drain'is conferred, and whether it is only at that point that it becomes a problem that Canada should be concerned about. It must be questioned whether this is an argument that will ever have an answer.

Some Perspective

Proponents of all sides of the debate on the 'brain drain' agree that the future of Canada is heavily dependent upon the intellectual capital of a highly skilled workforce.

A recent estimate placed the worldwide shortage of IT (information technology) workers alone, at more than 1 million. Current numbers indicate that 400,000 IT jobs in the U.S. went unfilled last year, a number that is expected to grow by at least 25% a yearⁱⁱ. The U.S. alone is expected to be recruiting for 850,000 openings in high tech in 2002ⁱⁱⁱ. Estimates place Canada's current shortage at greater than 40,000.

There can be no doubt that there is a worldwide shortage for crucial knowledge technology workers. As such, the real issue is whether Canada can effectively compete for skilled workers in this extremely charged global arena. The number of people leaving suggests that Canada is already perceived to be lacking.

How does Canada stack up?

A critical piece of information that Canada needs to assess its competitive position is to understand what individuals are leaving and what is motivating them to do so. This understanding allows for effective corrective and pre-emptive action to ensure success in the new global technical environment.

PERSONNEL SYSTEMS, a Canadian Management consultancy, has deep roots in the Canadian technology industry. They used those connections and their understanding of the industry to interview Canadian Expatriates currently working in technology fields across the U.S.. Over 130 individuals were interviewed. Interviewees were asked about their reasons for leaving, whether their expectations have been realized in the U.S., whether they expect to return to Canada, which country would they choose to start a business in and why, and under what circumstances they might return to Canada. Just as importantly, thoughts were gathered from these individuals as to what changes government, companies and the educational sectors can make in Canada to make it more competitive. Interview results are interesting, surprising and challenge many of the popular perceptions as to Canada's competitive strengths and weaknesses for attracting and retaining skilled technology individuals.

Ex-pats give Canada a failing grade:

• "Canada has always lost some people to the U.S., but my perception is that it is greater now. I guess I am an example. It was not something I thought I would ever do, but here I am."
• "If people cannot find meaningful jobs in Canada, of course they will leave. I know many that have, most are research-oriented people and have followed research dollars south."
• "The 'best and the brightest' have opportunities available to them globally – Canada does not compare favourably in what it can offer."
• "I moved to the U.S. right after graduation. A couple of years later my patriotic self found a job back in Canada – I stayed 1 year and could not wait to get back to the U.S. Working in Canada is like working in the back-woods."
• "People will go where they are appreciated, where there are lots of opportunities and where they are amply rewarded for efforts - this is not Canada."
• "There are lots of jobs in Canada but they are not of the same quality. There is also no comparison to being in the 'middle of where the action is' which is not in Canada. Even Ireland has made the overall industry 'exciting'. There is no excitement in Canada."
• "I think most people would like to stay in Canada if they could. It is not easy uprooting your entire family and moving them somewhere strange. But to stay people must have comparable opportunities and earning power."
• "Competitive is the key word. People leaving do not perceive Canada to be competitive – either for exciting work, jobs, money, taxes, business."

What do the ex-pats look like?

Gender:
Eighteen percent (18%) of interview respondents were women. This is perhaps a surprisingly high percentage in that technology industries are still heavily predominated by males. It is also a commonly held belief that women tend to be less mobile than their male counterparts.

Marital Status:
The majority of ex-pats interviewed were single, almost sixty percent (60%), but, perhaps surprisingly, almost twenty-six percent (26%) were married, and almost another fourteen percent (14%) were married with school-aged children. This representation pulls into question the popular belief that married individuals, particularly those with children would be less likely to move due to disruption to the family, difficulty in the spouse obtaining employment and the perceived lower quality education available in the U.S.

Eighty-one percent (81%) have not changed their marital status since moving to the U.S. however there is an interesting thirteen percent (13%) that have married U.S. citizens since their move. This change in marital status will certainly affect the decision of an individual about the possibility of ever returning to Canada.

Age & Experience:
"Employers Underestimate Mobility: Why Canada's High Tech Grads Look South," a survey conducted in 1998 By PERSONNEL SYSTEMS of third and fourth year university students in engineering and computer science indicated that eighty-eight percent would be willing to move to the U.S. No significant differences were identified based on which province they were located in.

While the largest single age group represented in the current interviews were the under-30 set (45%), a significant number of those in their thirties (32%), in their forties (18%) and in their fifties (6%) were also represented.

Not just recent graduates are leaving ... "How many years of experience did you have when you left Canada?"

Age and experience are related. Over eighty percent (80%) of interviewees had more than one year of experience when they left Canada and forty-four percent (44%) had more than 5 years of experience.

This representation of age and amount of experience provides support for industry assertions that it is not the mere number of individuals moving to the U.S., but that it is the quality and amount of experience being lost by Canada that is the larger problem.

When, and from where, did they leave?
The vast majority, nearly ninety-one percent (91%), left Canada for the U.S. in the last five years and nearly forty-eight percent (48%) within the last two years – a sign of the recent acceleration of this trend. Twenty-one per cent (21%) left in the last six months alone.

Survey respondents left from all over the country.

Figure 2: Province of Origin

The results here are probably not a surprise. Those provinces showing the highest incidence (Ontario, B.C., Alberta, and Quebec) are the provinces where the highest clusters of technology currently exist in Canada.

Where did they go?
Contrary to public perception, Silicon Valley is not the only destination for Canadian techies. Often quoted in the press are stories of the eroding standard of living in areas such as San Jose and Mountain View in terms of commute, quality of life, culture, and especially the cost of housing. Often cited are the stories of a few individuals moving back to Canada as a result, with the underlying thought that as conditions continue to erode more Canadians will move back. However, all moves to California (which include less stressed Southern California destinations such as San Diego) totalled slightly less than thirty percent of survey respondents.

Figure 3: Area of Relocation

Many areas of the U.S., other than California have rapidly growing technology hubs, including North Carolina, New England, Washington State and increasingly, Arizona, and Virginia. Texas is the fastest growing technology centre in the U.S. with over 2000 firms in Austin alone. The deterrents associated with Silicon Valley are not factors in these locations.

Area of Expertise:
All areas of technology expertise are represented in emigrants to the U.S..

Figure 4: Area of Expertise
Notes:

• Hardware: IC or embedded systems, digital and wireless communications, consumer product applications
• Software: software and software services
• Systems Integration: Systems Engineering and Integration
• Professional Services: Technical Services/Consulting
• Biotechnology: Biotechnology
• Other: Other

What is clear is that no one area of specialized technical knowledge is immune to the southward migration.

Conclusion

The demographics of survey respondents described here have laid the foundation of who exactly is leaving Canada to live and work in the United States. The next report in this series will detail how they found their jobs, why they left, and whether their expectations have been met. Finally, the last report will look at whether these expatriates believe they will return, and what they believe Canadian governments and businesses can do to stem the tide of emigrants. If Canada is not being competitive, which many respondents believe, then how can it become so?

Methodology:

Names of potential interviewees were solicited from technology company clients of PERSONNEL SYSTEMS through its compensation survey participants and other industry partners. Companies were asked to urge individuals that they knew had moved to the U.S. to complete the interview. Clearly these were often employees that these companies had lost to the U.S. Those completing interviews were also asked to identify other Canadians that they knew were working in the U.S. Using a special web-based interview technology, individuals were able to respond to the interview in an anonymous fashion. Validation of responses was ensured through requiring individuals to give detailed reasons for their responses.

For further information, contact:

Back to top | Back to HR Insights