Canada has committed to decreasing the number of temporary residents in Canada to 5 percent of the population by 2027. High numbers of temporary residents have strained housing, social services and urban infrastructure, and the issue has become deeply politicized. Several restrictive measures have been put in place which have successfully decreased the number of foreign workers and international students coming to Canada, with increasing economic effects. See my companion article: Reductions in Foreign Workers and Students in Canada are Working, but is that a Good Thing?
These temporary residence policy changes are weakening the flow of highly skilled labour into Canada’s technology sector, where shortages in certain occupations have already reached significant levels. Obviously, the tech sector labour market is not simple, as many complain that Canadian grads face difficulty obtaining internships and entry level positions (see the comments section on any post on the subject), while at the same time employers struggle to recruit and retain experienced, senior, advanced or niche tech talent in Canada. Despite the evolution of the job market due to constantly shifting tools and architecture, AI, and computer science education gaps, the number of tech workers continues to grow. In 2025, Information and Communications Technology Council (ICTC) reported that Canada needed an additional 250,000 tech workers, with over 25,000 cybersecurity roles alone remaining vacant. A Robert Half report states that 88 percent of tech leaders report difficulty in finding qualified candidates, despite intensified recruiting. Many employers say they cannot find sufficient full-time workers in high demand areas such as artificial intelligence, machine learning, cloud infrastructure, cybersecurity and data analytics.
Retention is another challenge as poaching of tech talent has become increasingly common. Many skilled workers are lured away by higher salaries and signing bonuses, more flexible working conditions, and more prestigious projects. Of course, poaching happens both within Canada and across borders and is just part of the game. Companies want the best talent and will do what they can to entice them, whether in Canada or internationally. For Canadian companies, a key part of the offering is Canada itself: relative political and economic stability, low corruption, access to universal healthcare, education, personal safety, and the incredible natural beauty of the country.
Many Canadian business leaders opined that the recent change to the US H1B program (employers for new hires are required to pay $100,000 fee), is a huge opportunity for Canada, and it really could be. Frankly, while people are definitely feeling uncertain about the future of immigration in the States, there is no shortage of uncertainty right here, as well. This needs to be addressed urgently.
According to CTV News, Prime Minister Carney recently stated “So it’s an opportunity for Canada, and we’re going to take that into account. And we’ll have a clear offering on that.” I am excited to see just what that offering will be.
However, so far, our experience is that many international workers are looking to pivot into other work permit categories to allow them to stay in the US. In addition, Canada should be very careful as Benjamin Bergen, president of the Council of Canadian Innovators, said last week: Canadian workers may become more attractive to US companies seeking to lure them, as there are several creative ways to bring Canadian workers to the United States, for example, through an intra-company transfer. To address this, we need clear, tech-specific programs to give Canadian companies flexibility and responsiveness.
Departures from Canadian companies are especially damaging to startups, which may lose not just a worker but a key architect of their platform or product roadmap. In cybersecurity, where institutional knowledge is paramount, such turnover can introduce serious operational vulnerabilities.
In the past, Canada has tried to respond with targeted immigration strategies. The Tech Talent Strategy introduced in 2023 offered open work permits to U.S.-based H-1B visa holders. Up to 10,000 skilled workers were allowed to move to Canada with their families and work for nearly any employer. The cap was filled in just 48 hours, demonstrating enormous latent demand. Follow on analysis showed that only a fraction of those who applied eventually came to Canada, which is something that deserves to be studied.
Today, the Global Talent Stream (GTS) continues to be the go-to pathway for many tech employers. Category A allows innovative companies to be referred by a designated referral partner and Category B lists a large number of tech occupations that qualify for the program. GTS allows employers to get approvals for specialized workers within approximately two weeks, as long as they commit to various efforts such as job creation, upskilling Canadians, or building partnerships with academic institutions. While even this program could be improved, it is a real option, and many tech startups and mid-sized firms rely on this stream to maintain growth trajectories in the face of domestic talent shortages.
There is still plenty of room for improvement. We need to harmonize pathways to permanent residence for workers who have gained experience in Canada. This has been a major draw and critically important to attracting talent but has become a serious problem over the past couple of years. Many incredibly talented people no longer qualify under traditional programs. Some provinces have taken action through various Provincial Nominee Programs (PNPs) like Alberta’s Accelerated Tech Pathway and the Atlantic Immigration Program (AIP) which provide routes to bring in high-skilled workers and transition them to permanent residency but it is not enough.
In its May 2025 report, A Mandate to Innovate: CCI’s Policy Blueprint for Canadian Economic Growth, the Council of Canadian Innovators emphasized the impact on immigration policy on innovation, and specifically the need to improve the Global Talent Stream and implement better programs and supports.
Reduced access to skilled foreign innovation workers threatens the development of new products, delays scaling plans, and deters investment. Investors may see Canada as a less predictable and less scalable market.
Meanwhile, the demand for tech talent shows no sign of abating. According to CompTIA’s State of Tech Workforce Canada 2025 report, the Canadian tech industry employed 1.45 million people in 2024, a 1.9 percent increase from the year before. This workforce is expected to grow faster than the overall employment rate in the coming decade. The sector includes more than 83,000 businesses and contributes over 130 billion dollars annually to the Canadian economy. The average tech worker earns around $97,000 per year, roughly 48 percent more than the national average.
Companies in Canada generally report that 77 percent of their postings remain difficult to fill. Tech companies, and non-tech companies seeking tech talent have even more challenges. Startups are particularly vulnerable, as they cannot match the salaries or resources of larger firms and must compete using equity, flexible culture, or the benefits of living in this incredible country.
Ultimately, while the goal of easing housing and infrastructure strain is imperative, blunt reductions to work permits are a costly solution. Immigration has long been one of Canada’s most effective economic tools and it should not be sacrificed for short-term planning, or worse, optics. A better strategy would involve preserving and expanding well-regulated, fast-track work permit and immigration programs for highly skilled workers while improving the integrity of the system. In my opinion, it is important to recognize the key, indispensable role that technology is playing in improving those very systems. And, of course, Canada must also invest in housing and urban infrastructure in parallel, which is clearly on the Carney agenda. The sustainability of Canada’s tech sector, and the broader innovation economy, depends on a rational, data-driven and well-informed immigration system.
