> It’s one that we’ve been facing for quite some time. The reason we wrote this report, however, is to highlight the fact that we’re sort of in this moment in time right now, with our relationship with the U.S. deteriorating and us trying to diversify our trading partners, to highlight the fact that we are still not really all that competitive. Our productivity growth is quite low and has been for a few years now. So, banging this drum about wanting to raise this issue around competitiveness, that was the goal of this.
With the U.S. moving from a cooperative trade partner to a trade competitor, Canada needs to up its game.
Even if the US was still benevolent (ish), Canada needed to up its game. I have heard Canada be described as "European wages with American working hours".
It's a great country with good people and lots of beauty, but they need an economy and job prospect beyond real estate, mining, banking, automotive, and government funded. The country seems to lack diversity in prospects and relatively uncompetitive wages.
For those leaving after completely undergraduate schooling that is taxpayer subsidized, there should be both carrots/sticks to discourage it - carrots would be to substantially juice tuition tax credits to give young people a better shot to save coming out of school. Sticks would be that if you are leaving soon after graduating, you are maybe on the hook for paying back some of that subsidized education. I'm not married to the exact carrots and sticks, but the country probably needs to do something short term while they also sort out future economic growth sectors.
More highly educated Canadian and Mexican professionals are relocating to the US than ever before, which is obviously concerning for Canada.
Accumulate wealth by any means necessary. If you find yourself with nice RSUs or options, hang on to them or exercise them, respectively.
When you're fed up move back to Canada and enjoy no exit tax and enjoy the step-up cost basis on all your assets. Sell all your RSUs and pay nearly zero capital gains. Use your imagination here.
(If you are unlucky and only have losses, well, you'll never really be able to use them tax-wise.)
> Colonial administrators in Canada observed the trend of human capital flight to the United States as early as the 1860s, when it was already clear that a majority of immigrants arriving at Quebec City were en route to destinations in the United States. Alexander C. Buchanan, government agent at Quebec, argued that prospective emigrants should be offered free land to remain in Canada. The issue of attracting and keeping the right immigrants has sometimes been central to Canada's immigration history.[245]
One time offers will often only get temporary results.
Anecdotally, a lot of us return to Canada after a short stint in the US.
Speaking as a Waterloo grad that moved to the US for about 5 years post graduation. Many of my university classmates did something similar.
But eventually life catches up to you, especially if you have strong family/social roots in Canada. It's not easy to bootstrap that in a new country.
I was also there under a TN Visa and had a few border experiences that rubbed me the wrong way since the TN Visa is a bit hand wavy and up to the border guard at your time of entry. The hostility at times from the border guards didn't make it feel like I was returning "home". Sure, I worked for a company that had an army of lawyers to fix it if anything went wrong but it still leaves you with a sour taste. I can't imagine they're getting any friendlier these days.
Lastly, I didn't mean it like 5 is some magic number - some stay less, some stay more.
I worked in the US for a bit when I started out. I paid more income tax in CT than in Toronto on the same salary.
I just wanted to come back home. Even in small town CT, there were areas we were told to stay away from after dark.
1) more interesting work opportunities; and
2) more money
And the delta on (1) has never been smaller thanks to remote work post-covid (even after all the RTO).
So basically, at some point, you start asking if the extra money is worth it.
(Depending where you come from in Canada, lifestyle in SF might be better overall - but then you can just move back to somewhere else in Canada and have it all.)
Although it feels like all of the desirable jobs (in terms of technical interestingness and pay) are in the US. At least for internships.
The first thing to consider here is that Canadians are in an unique position to move to the US.
They are more likely to have family, friends, travel for leisure and business, easier work visas (TN), Canadian universities are recognized in the US, and so on.
Second thing is that for the people that have the means, moving early in life to the US might be the factor between affording the life you want with ease vs having to compromise.
Many of my friends in tech that moved are saving 1.5x to 2.5x compared to the ones that stayed.
So I don't see a way for Canada to not be a source of talent to the US market. But I also don't believe that is the most interesting question.
The question that I believe matters most here from a society/economy perspective is: is Canada's economy providing the right incentives for innovation and entrepreneurship?
From that perspective the first thing that needs to be addressed is that we can't compare only taxes rates and income.
Canada has a very different tax system, where being able to maximize your TFSA and RRSP will probably set you up pretty well for retirement. Cost of housing is high, but cost of borrowing can be much lower than similar US mortgages. Canadian taxes also include healthcare that is more efficient (cost wise) than the American model.
So while you can get rich faster in the US, the reality is that you will need a lot less income to achieve similar quality of life depending on the cities you are comparing.
My personal notes for Vancouver, BC vs Seattle, WA concluded that for a family of 2. The gross income required to live a fair life that includes: - owning a decent property - be able to retire with no need to reduce cost of living - taking vacations and going out often - hedging health costs You are looking for around 200k CAD vs 250k USD of steady yearly income.
Those incomes are very achievable in both places for people that are considered top talent and companies can provide such income locally.
On the tax side, Canada could improve, but I don't believe that lowering taxes will bring much value.
Where Canada seems to struggle is on the regulation side. Canada is aligned with the US, which means that when addressing the Canadian market, your business is most likely also able to easily address the US market. This means that you will probably be better of setting up your center of operations in the US and not in Canada.
At the same time, big Canadian focused corporations operate mostly in an Oligopoly way. Smaller companies need to fight both regulatory requirements that didn't exist before and have a harder time getting the money they need to scale operations.
Adopting European (and Asian) standards could severely improve competition as companies could more easily extend operations into Canada without having to also support the US market, while in the long term Canadian companies would be able to choose the regulations that give their products the access to the most appropriate markets.
I suppose data could be used to justify whatever position and thus earn daily bread for the headline. Tomorrow there’ll need to be another story.
I've done well since then, but being in Canada I'm always "out of band". Implicit implication that I should move south where lower level positions already match Canadian bands
It is a non-immigration visa so it isn’t a path to citizenship, just an American job. Many Canadians take advantage of this.
Peter Roberts the immigration attorney that regularly posts here can validate that.
EAD/AP shows up in around 4-5 months for most people and those restrictions are then no longer a concern.
Edit: You still need to be a Mexican or Canadian citizen.
I'm also from Canada and I know tons of Canadians that have come here since the 90s. I even known immigrants to Canada from other countries (mainly China and India) that came to the US via Canada, using the TN1 or H1B visas after getting their Canadian citizenships.
The biggest problem Canada has is that any moderately successful tech worker is going to be dead-set on trying to get into the US because the Canadian tech scene can't compare based on base pay, annual bonus, starting equity or refreshers, etc. I make more money than all my friends combined. One of my friends is a teacher in Toronto and my annual bonus is more than his entire yearly salary.
I'm sure a lot of Canadian tech workers would repatriate and foreign workers would immigrate to Canada if they could lower taxes across the board and make life easier for tech companies and workers. There's literally trillions of dollars in tech ideas that could have been created in Canada but all of the founders left for the US.
I'm not sure that Canadian taxes compare that unfavourably to combined California plus federal taxation. A deeper, more structural limitation appears to be the venture capital environment, namely that Canada doesn't have a good one.
Canada's investable capital is dominated by pension funds, insurance companies (i.e. pension funds), and banks (i.e. pensioners). All are risk averse (https://thelogic.co/news/bdc-canadian-venture-capital-report...), which makes it hard for Canadian startups to begin scaling. Without native "unicorns" (https://financialpost.com/technology/why-canada-best-startup...), there's allegedly a failure-to-launch for the entire sector – tech billionaires being some of the most reliable early-stage investors with the greatest risk tolerance.
The porous border works both for and against the sector. On one hand that makes it relatively easy (but not automatic) for a Canadian tech company to enter the US market, but on the other hand it's also relatively easy for Canadian tech workers (founders included) to simply relocate (note the article here). If startups leave for the US's vast fields of venture capital, they're less likely to come back. Note that around the turn of the year Y-Combinator halted investments in Canadian firms (https://www.ycombinator.com/blog/adding-canada-back) because they so frequently relocated to the US.
This venture capital cycle seems to be a deeply-entrenched and very hard problem. If democratically feasible tax incentives could reliably create "the Silicon Valley of X," then we probably would have many more Silicon Valleys both in the US and elsewhere.
It's concentration of nodes in the graph that makes SV unlike any other place on earth.
Other places that want to be SV need to solve the cold-start problem to build up their local node set, not emulate what SV is like today.
I believe that my comment above was aligned with your premise here. I say that the tax difference is not sufficient by itself and that Canada reportedly has a very non-SV-like venture capital ecosystem.
Get richer friends! Problem solved!
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>FRANCIS: No, I think, Roger, you pointed to it correctly. This is not an issue that is brand new for Canada.
oh, okay then. so, the same thing is happening as has always happened. the only interesting thing about this article is trying to determine if it's motivated by the opposition party trying to score some points (like it usually is) or by the US trying to share a positive in response to all the "canadian tourism numbers are down" stories going around lately.