A growing technology sector pumping billions into the economy: VIATEC

Greater Victoria’s technology sector has not only thrived during the pandemic, it is on track to meet its goal of $10 billion in annual revenue by 2030, its industry association said Thursday.

The sector contributed nearly $5.9 billion in total direct revenues in 2023, growing at a “healthy rate” from $1 billion in 2004, according to a new report on the sector’s economic impact on the capital region.

Indirect revenues brought in another $2 billion, bringing the total economic impact to $7.9 billion, it says.

Total employment in the sector rose to just over 20,000 workers last year, up from 16,775 in 2017. Of these, technology companies employ 17,897 people, and 2,110 are self-employed.

The report was prepared by Alan Chaffe, senior manager of economic research at the Conference Board of Canada and lecturer at the University of Victoria. It was commissioned by VIATEC, the Innovation, Technology and Enterprise Council of Victoria.

The technology sector in the capital region is not only about information and communication services. It also covers areas such as ocean and marine technologies, advanced manufacturing, aerospace, education and training, gaming and entertainment, life sciences and internet marketing.

The pandemic has provided something of an “unexpected push,” VIATEC CEO Dan Gunn said at a sector meeting at the Fort Tectoria office on Fort Street.

“Many people have started turning to technological solutions to survive the changes (caused by) the pandemic. So, traditional industries have seen a lot more digital solutions and a lot more innovation. So we were pleasantly surprised.”

Like many other sectors, the number of people working full-time in an office in the technology sector has declined due to the pandemic and is down 40 percent, Gunn said. The number of people working from home has doubled, and the number of people working in hybrid mode has increased by 31%.

“It changed things forever,” he said. Companies are currently checking how much office space is needed.

Gunn said finding trained technical workers is a global challenge.

He said that in 2022 there were many more job offers than people, adding that now that the investment market has cooled down, the situation has calmed down a bit.

There’s not as much capital available right now and valuations aren’t as high, so everyone is stretching their money even further, he said.

The report notes that in “a rapidly evolving technology industry where innovation is constant, the need for specific skills among technology workers is constantly changing.”

In the Capital Region, software engineering and development skills are most in demand, followed by marketing, sales and product management.

Gunn said there is currently a surplus of younger talent in the region.

Key advantages of attracting people to the local tech sector include post-secondary institutions, a mild climate and favorable lifestyle, and shorter commutes than in some other communities.

However, according to the report, the main challenge for companies is the availability and affordability of housing, closely followed by the cost of living.

“We’ve definitely heard from employers who have said, ‘It’s really hard to hire someone to help them find a place to live… I know there are policy efforts being made to address this, and I hope they work,’” Gunn said.

The voivodeship initiated a package of initiatives aimed at increasing the number of apartments, including: enabling the construction of multi-family plots and supporting housing development near transit terminals.

Technology companies have found that the biggest barrier to success is recruiting technical staff and senior management. Next on the list were access to finance and factors such as limited government support, a reliable supply chain and access to new markets.

VIATEC participates in the federal Start-Up Visa program, which allows foreign entrepreneurs to apply for a visa to Canada to start a business.

“We love this program,” Gunn said. “We have hundreds of candidates from all over the world.”

The organization provided a letter of recommendation for 35 applicants to be forwarded to Immigration Canada. Of these, a dozen or so were created in the capital region. VIATEC is the designated body authorized to support people under the program.

“We believe this is a great way to grow our economy and attract more businesses,” Gunn said.

“Because they are international entrepreneurs, they have connections with investors and talent where they come from, which opens up opportunities for people to enter new markets, get new investments and attract new people.”

Looking to the future, Gunn said technology is evolving rapidly and the role of artificial intelligence – artificial intelligence – was not envisaged five years ago.

“I think we will see more use of tools like this to increase productivity.”

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