Canada's Approach to Attract and Retain US Tech Talent

Canada’s Approach to Attract and Retain US Tech Talent

By The Fatty Fish Editorial Team - August 1, 2023

Canada’s government recently introduced a new work permit that targets US tech talent. Experts report that H-1B non-immigrant visa workers in the US pay at least $85 billion a year in federal and state income taxes, support Social Security and Medicare through payroll taxes, and generate tens of billions more in consumer spending. They also say that rather than replacing native-born workers, each H-1B visa holder creates roughly two new jobs by enabling companies to invest in domestic expansion rather than send jobs outside the country. If scientists and engineers keep leaving, many of their would-be employers will follow, which would erode US productivity, reduce economic growth, and lower living standards.

Canada allows digital nomads to spend up to six months in Canada with simple visitor status while working remotely for foreign employers. The federal agency Immigration, Refugees and Citizenship Canada (IRCC) is hoping to work with public and private partners to make digital nomad residency in the country more attractive, hoping that these digital nomads ultimately choose to stay and seek employment within the country.

Another, more aggressive aspect of the IRCC Tech Talent Strategy will make it easier for skilled US tech talent to be able to enter and find work in the country. Many specialized tech workers in the US hold H-1B specialty occupation visas and as of July 16, 2023, these visa holders and their accompanying immediate family members became eligible to apply to come to Canada. If approved, they receive an open work permit of up to three years. The initiative also includes improvement programs that cater to skilled workers in the tech industry and a path to permanent residence for entrepreneurs living abroad who gain the support of a designated Canadian venture capital fund, angel investor organization, or business incubator for their start-up. Here is an opinion piece we found of interest relating to Canadian initiatives to attract US H-1B visa holders.

Don’t Blame Canada for Raiding America’s Tech Talent

In an opinion piece, “Don’t Blame Canada For Raiding America’s Tech Talent,” for Bloomberg, the Bloomberg Editorial Board argued that US President Biden should call on Congress to admit more immigrants who possess the skills that companies need and provide an easier path to permanent residence. The authors pointed to Canada, whose government recently introduced a new work permit targeting US-based knowledge workers. Foreigners who are living in the US on H-1B visas, typically with skills in science, technology, engineering, math (STEM) fields, are eligible for three-year work permits allowing them to work for any employer in Canada. Unlike the US, which restricts spouses of visa holders to work, Canada would allow the spouses of these visa holders to pursue employment. Initially, Canada said it would accept up to 10,000 applications from interested H-1B visa holders in the program’s first year; it received that many in less than 48 hours. The authors reported that the government has already received requests from Canadian tech companies asking that the program be doubled.

Although the US was once the world’s most desirable destination for science and engineering talent, it is now losing tens of thousands of potential foreign immigrants each year to Canada, according to the authors. The Bloomberg Editorial Board argued that in theory, workers on employer-sponsored H-1B visas can stay in the US for up to six years, then apply for permanent residence. Yet the bureaucracy, rules, and caps on the numbers of Permanent Resident (green) cards issued to citizens of any single country mean the wait can last decades. Some Indian workers with advanced degrees face estimated waits of more than 150 years, according to the authors. In addition, the US requires that H-1B visa holders who lose their jobs find another employer to hire and sponsor them within 60 days or face deportation. At least 50,000 such workers have had their visas revoked since Fall 2022, when tech giants such as Amazon and Meta started laying off staff amid a slump in tech stocks. Given this uncertainty, even H-1B workers who kept their jobs are taking up Canada’s offer to move there instead. Read the full article on Bloomberg.

Disclosure: Fatty Fish is a research and advisory firm that engages or has engaged in research, analysis, and advisory services with many technology companies, including those mentioned in this article. The author does not hold any equity positions with any company mentioned in this article.

The Fatty Fish Editorial Team

The Fatty Fish Editorial Team includes a diverse group of industry analysts, researchers, and advisors who spend most of their days diving into the most important topics impacting the future of the technology sector. Our team focuses on the potential impact of tech-related IP policy, legislation, regulation, and litigation, along with critical global and geostrategic trends — and delivers content that makes it easier for journalists, lobbyists, and policy makers to understand these issues.