Brain drain not just a Canadian problem

For more than a decade the general consensus has been that Canada is losing skilled workers to the U.S. in massive numbers, but interestingly, the statistics tell another story.

While many Canadians are certainly migrating to the U.S. the more interesting question is why?

Cesar Pinto was the CIO of LockHeedMartin Canada in Montreal between 1986 and 1997 as a CIO. Pinto said he left for the U.S. because of the “lack of growth opportunities in Canada. We have few programs (in Canada) in the type of information technology and development as in the U.S. and it’s not very well funded in Canada.”

Pinto initially moved to the Washington, D.C. area and has subsequently moved to Utica, N.Y., where he is still employed by LockHeedMartin. He currently manages about 500 IT professionals, and is responsible for more than U.S.$75 million in projects. “There may only be 20 or 30 jobs like this in all of Canada, (and so) the growth opportunity, once you get to that level, is fairly limited.”

the stats

A study compiled in Ottawa by Personnel Systems on the brain drain focused on issues like taxes, disposable income, health care and crime. The survey, conducted via the Internet, examined five Canadian and U.S. cities: Vancouver, Calgary, Toronto, Montreal, Ottawa, Boston, San Jose, Austin, Raleigh and Seattle.

Janice Shellenberger, a partner at Personnel Systems, said that while Canadians are departing for places like Silicon Valley, individuals are also relocating to places like Texas where housing costs are not quite as elevated. But taxes are only one reason departures occur.

In the U.S., based on a seven-year study, estimated shortages in the IT sector are around 500,000; in Northern Virginia alone, they estimated a shortage of around 35,000. In Canada, the numbers were estimated around 40,000 and in Europe, the shortage is estimated to be more than one million in the next several years.

“Canada is being targeted for all of our skilled people by these other countries because of the magnitude of the shortages,” Shellenberger said.

Another issue is education, because while educational institutions have increased the number of students in the IT field, from a North American viewpoint, “even if they could all double their capacity, they still couldn’t turn out people in the next couple of years to meet that kind of demand,” she said.

She went on to add that while money was a real reason for leaving Canada, there is a perception that the U.S. offers a more entrepreneurial business environment, more leading-edge technology, plus interesting work and career opportunities. “No one is to really blame (for that), except the rapidly developing technology.”

Education’s drawing power

John Olsen left Canada as a teacher in Red Deer, Alta., because he was given the opportunity to pursue graduate studies at MIT. As Olsen said, “I had a chance to go to MIT, (and) I jumped at it. There isn’t another MIT anywhere in the world.” Olsen said that taxes are not a motivation to stay in the U.S., saying he paid relatively the same amount while he still resided in Canada, and has only seen the change now that his pay-scale is considerably higher. Olsen now works for Avialant in Boston as a project manager, and said that crime has never been a factor.

And while health care is not a financial burden as the company absorbs half the cost and the other is deducted from his pay cheque, there certainly are concerns about how the U.S. system is run. “I have to be sure I know where I’m going if I’m sick, I can’t just go to any hospital. I have to go to the right hospital or else I’m not covered, or I’m in some kind of insurance limbo.” Olsen went on to add that the health care system is one of the things he misses about Canada.

Pinto said health care in the U.S. has been a problem for his wife, yet he tipped his hat to the American system because if you can afford it you can get great coverage, while in Canada “you get what you get.”

And while Pinto now makes about 30 per cent more money living in the U.S., those funds are ultimately redirected. “Living in the U.S. you pay lower taxes (but) you’re going to buy the health care you are accustomed to, buy the school system you are accustomed to. To maintain our children’s French we had to put them in a private school at a considerable expense.”

But at the end of the day, Pinto said that if he was making $10 living in Montreal he now makes $13 living in the U.S., and this is in absolute dollars, not factoring in the exchange rate.

But the real issue for Pinto is how easily U.S. companies invade Canadian schools. “I can go down to Concordia and offer a four year computer graduate US$45,000 to US$50,000 and a signing bonus of US$5,000 to US$10,000. We are allowed to recruit in Canada with impunity.”

Going home again

John Olsen said that he would consider moving back to Canada, but is currently involved in a relationship that will make that an unlikely scenario, and would only do so if he could move back to a major Canadian city. At no point did he mention financial considerations as a restricting factor to his return.

So what can Canadian IT companies do to keep from losing people like Pinto, a former CIO, and Olsen, who moved for educational reasons? Shellenberger said Canadian companies “need to sell themselves better, in terms of opportunities they provide and career opportunities.”

But with graduation soon to be taking place across this country, how many U.S. companies have already recruited a plethora of Canada’s finest?