Toronto is the fastest growing tech talent market in North America, according to a new report by CBRE, a Los Angeles-based commercial real estate services and investment firm.
CBRE’s report, titled Scoring Tech Talent, ranked 50 US and Canadian city markets based on their ability to attract and grow tech talent. Specifically, the report looked at the quality of tech talent, factors such as employment breakdown and population trends, and how tech talent growth patterns are impacting cities and real estate markets.
“Toronto is a becoming a leader in producing a world-class tech talent, particularly in the artificial intelligence field.”
While CBRE ranked Toronto 12th on its Tech Talent Scorecard in 2016, this year, Toronto’s ranking moved up to sixth place. CBRE said the higher ranking is in large part due to Toronto’s “talent employment base growing by the highest number of workers from 2015 to 2016.” In 2016, Toronto added 22,500 tech jobs to its workforce. Comparatively, New York added 5,370 tech jobs and San Francisco 11,540.
“Toronto is a becoming a leader in producing a world-class tech talent, particularly in the artificial intelligence field, and there had been an incredible rate of growth in our tech labour force in the past year,” said Werner Dietl, executive vice-president and GTA regional managing director of CBRE Canada. “When you consider we’ve added more tech jobs from 2015 to 2016 than New York and the San Francisco Bay area combined, it shows just how vibrant Toronto’s tech industry has become. Tech companies now comprise over 20 per cent of all current office space demand in the city.”
Related: TechTO report says that tech accounts for 15% of all Toronto jobs
When it comes to the size of Toronto’s tech talent market, CBRE found that Toronto ranks as North America’s fourth largest tech talent market. The city has 212,000 tech workers, which represents a 32 percent increase over the past five years. In addition, Toronto’s tech talent comprises of eight percent of all workers in 2016, up from 6.9 percent in 2015.
CBRE’s report also indicated that Toronto ranked third among large markets with a high millennial population growth. CBRE noted that this figure is important, as millennials are an important source of tech talent, and found that from 2010 to 2015, Toronto’s millennial pool grew by 9.5 percent.
“Regardless of currency differences, Toronto remains comparatively cheap for both talent and real estate costs.”
Along with the size of Toronto’s tech market and how rapidly it is growing, the CBRE report also looked at how affordable Toronto is for tech companies to operate in. The report found that Toronto is the second-cheapest market in North America for a tech firm to operate in. The estimated cost of running a 500-person tech firm in Toronto totaled to $32 million ($25.9 million USD), which was significantly lower than the cheapest US market of Oklahoma City, which totaled at $42 million ($33.9 million USD.)
“Even if you remove the effect of a discounted Canadian versus US dollar, Toronto still remains one of the most cost effective markets in North America for tech firms to operate from,” said Dietl. “Regardless of currency differences, Toronto remains comparatively cheap for both talent and real estate costs when compared to major markets such as New York, San Francisco, and Boston.”
Dietl added that Toronto is not only a cheap market to operate in, but it also provides international firms access to the city’s “high-quality talent pool” and “Canada’s immigration policies that allow them to recruit and bring over the best talent from around the world.”
Among the other Canadian cities CBRE analyzed was Vancouver. CBRE’s report ranked Vancouver as the 16th fastest-growing tech talent market. While Vancouver was ranked lower than other Canadian and US cities, CBRE found that the city, along with Toronto, provides the best value when it comes to cost and quality, followed by US cities Indiana, Pittsburgh, and Detroit.
View the full report here.