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US IT headed towards Canada

by on09 February 2018

IT industry lured over the border

The US is facing a concerted drive from Canada to poach its IT industry, and there are signs that it is paying off, thanks mostly to the current stance on immigration.

Salesforce has announced it will pump $2 billion into its Canadian business over the next five years. It is the latest significant US technology investment across the border since early 2017.

Toronto is a hub for artificial intelligence research and Canadian Prime Minister Justin Trudeau is visiting California this week in part to speak with US technology chief executives. Canadian leaders have promoted their country’s immigration policies as an alternative to the Trump administration’s ban on travellers from some Muslim countries and restrictions on work permits for some foreigners.

Salesforce CEO Marc Benioff did not specify why the company chose Canada, but he said: “Like you, we’re a city that values diversity, we value equality, and we also value innovation. ...We know we’ll be able to have a great business environment in Canada.”

A Canadian programme allows businesses to get work permits for foreign workers in about two weeks which must have been a great reason. The IT industry in the US has been propped up by using foreign workers to cover skills gaps.  However, since Donald Trump took over that particular method has been mostly shut down. Silicon Valley still needs the staff and still can't find US workers with the skills so moving to Canada makes sense. 

Salesforce said it would increase its Canadian office space, data centre capacity and 1,000-strong workforce, without giving details.

“We know that being open to investment and highlighting our extraordinary diverse workforce that’s willing to work hard, innovate and create a future is what it’s all about”, said Trudeau on Thursday at Salesforce’s San Francisco offices.

Several other US technology companies are expanding into Canada. In May, Uber said it would open a new artificial intelligence research hub in Toronto. Alphabet's DeepMind unit in July announced plans to open a research office in Edmonton, and Amazon put Toronto on a short list of contenders for its $5 billion second headquarters.

Facebook said it would expand its artificial intelligence research lab in Montreal, where Microsoft also plans to double the size of its research lab.

Several tech entrepreneurs in Canada said the University of Toronto, in particular, was a draw, thanks to its research in machine learning and other artificial intelligence, and that businesses also could be confident they could hire anyone they wanted, given immigration policy.

“You want the best minds wherever they are”, said Mike McDerment, chief executive of FreshBooks, a Toronto firm that develops accounting software. “The fact that we have this open and inclusive culture, it’s a great advantage.”

Last modified on 09 February 2018
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