Leveraging Immigrant Talent for Business Development
So I recently purchased an environmentally friendly humidifier for my home – called the Rumidifier – you may have heard of it. It’s a great innovation, requires no energy to run, and it works really well. What’s that got to do with immigration and business development you say? Well, it turns out that the Rumidifier was developed by a local immigrant entrepreneur. It’s a terrific success story, and one that illustrates how the skills and talents of newcomers can lead to exciting new Ottawa based business ventures, creating jobs and growing the region’s economic base.
To be sure, business development objectives are at the forefront of local efforts to ensure continued prosperity in the Nation’s Capital. Invest Ottawa for example, is leading the way with innovative programs and resources that promote and support entrepreneurialism, investment and business growth in the capital region. With downsizing and adjustments in the federal public service, this focus is both timely and welcomed.
Along with this focus on growth and diversification, there is a widely held view in Ottawa that immigrants will play an important, perhaps even critical role in the future success of the city. The Ottawa Local Immigration Partnership (OLIP) for instance, tells us that “successful attraction, settlement, and integration of immigrants is essential for Ottawa’s future prosperity and vitality.”
So is there a relationship between immigration and the broad objectives of economic growth and diversification? Can immigrant talent be leveraged to advance and optimize Ottawa’s business development objectives?
I’d like to suggest a few of the ways in which immigration already furthers economic development objectives in Ottawa. As a starting point, I’ll refer to some work recently produced by the International Economic Development Council (IEDC), which is the world’s largest membership organization of economic development professionals. Last July, the IECD released a report outlining four ways in which immigration furthers economic development objectives: by contributing to economic expansion; by fueling STEM (Science, Technology, Engineering and Mathematics) industries; by leading to immigrant owned businesses; and by supplementing the labour force in critical ways.
Let’s look at each of these in turn and see how it relates to the situation in Ottawa. Bear with me as I take you through a few numbers.
Economic Expansion: Immigrants contribute to economic expansion in several ways. First, immigrants are a main contributor to Ottawa’s net labour force growth. Between 2001 and 2011 for instance, immigrants represented 51% of Ottawa’s net labour force growth. Immigrants also contribute to the pool of skilled workers. For example, the 2011 National Household Survey showed that immigrants made up 27% of Ottawa’s labour force with post-secondary education, 37% of Ottawa’s labour force with a Master’s degree, and 57% of Ottawa’s labour force with an Earned Doctorate.
Immigrants also create increased demand for goods and services, from basic necessities of food, clothing, and shelter, to automobiles and artwork. The impact of immigration on total consumer spending power can be demonstrated with this simple example. In 2010, Ottawa’s recent immigrants (i.e. people arriving between 2001 and 2009) had an average income of $30,440 (before taxes), for a combined or aggregate annual income of over $1.3 billion. Much of this income will have been spent paying taxes and purchasing goods and services in Ottawa.
Fueling STEM Industries: A recent report published by the Canadian Council of Chief Executives argues that STEM skills are vital to Canada’s success in the global knowledge economy, particularly in economic sectors where technological innovation is important. In Ottawa, immigrants make up a large share (37%) of the STEM workforce. In fact immigrants with STEM backgrounds are one of the reasons Ottawa can boast being the Canadian city with the highest percentage of its labour force with STEM specializations. Clearly this represents a great advantage for Ottawa in terms of attracting investment and business, as well as supporting start up ventures.
Immigrant owned businesses: I wish I could tell you the number of immigrant-owned businesses in Ottawa, the revenues they generate, and the number of people they employ, but to my knowledge, that information isn’t available. What I can tell you is that in Ottawa, immigrants are slightly more likely than the Canadian-born population to be self-employed (10.0% compared to 8.6%). A research carried out at the University of Ottawa found evidence to suggest “that immigrants have resources such as access to international networks that provide competitive advantage over non-immigrant owners that export or aspire to export”. In Ottawa, these international networks are far-reaching and numerous, given that the immigrant population hails from more than 160 countries around the globe, including high growth economies such as China and India.
Immigrants Supplement the Labor Force in Critical Ways: Let’s also not forget that Ottawa’s labour force continues to age, and we will be seeing an elevated number of retirements in the years ahead. Consider that in the last 10 years, the number of employed persons aged 55+ increased by 78%, more than five times the 14% growth rate of the overall workforce. To meet the skills needs of Ottawa’s dynamic growth sectors and at the same time meet the challenges posed by an aging workforce, Ottawa’s employers will need to support and develop top talent, including young people entering the workforce, current workers seeking professional development, and internationally educated and experienced newcomers who now account for the majority of Ottawa’s annual net labour force growth.
Leveraging Immigrant Talent for Business Development
It seems clear that immigration contributes to business development and economic growth in Ottawa, whether it’s as a source of skilled labour or as entrepreneurs developing innovative new products – like the Rumidifier. But important questions remain. How can employers and other stakeholders leverage the skills, knowledge and global networks available within our newcomer population to optimize business development and expansion? How do we as a community identify and support immigrant entrepreneurship? As employers, what workplace policies and practices are effective for integrating and leveraging the skills of newcomers to serve a growing and diverse city?
These questions will be addressed at HIO’s 2014 Employer Council of Champions Summit: Leveraging Immigrant Talent to Grow and Diversify Ottawa’s Economy to be held this coming March.
Clarence Lochhead
Senior Manager, Policy and Research, Hire Immigrants Ottawa
