Ottawa Tech Jobs Melting Away

The Ottawa-Gatineau unemployment rate took a sharp jump recently and currently sits at 5.2%.

Under the surface, the situation for tech jobs is increasingly serious.

In Ottawa-Gatineau technology jobs have been evaporating at an alarming rate –  in just the last 12 months,  the region has lost 8,800 tech jobs.  This represents greater then a 14% loss. Further, Ottawa-Gatineau has lost almost 30% of its regional tech jobs compared to 2000.   Ottawa-Gatineau tech jobs peaked at 74,000 in 2000 and are now down to 53, 800 as of March 2009.

Stats Canada has published that during the 2002 bubble burst – 4 out of 5 laid off tech workers did not find work in high tech, and 2 of 5 left the City of Ottawa.

The tech sector is continuing to shed jobs in Ottawa-Gatineau.

Ottawa-Gatineau faces a significant loss of tech capability and associated economic impact/growth for the region.

Lead to Win is focused on launching new technology businesses in Ottawa-Gatineau to retain and create new tech jobs.   If you are concerned about the state of the technology sector in Ottawa-Gatineau or are interested in launching a new tech business in the region, you are encouraged to visit http://www.leadtowin.ca.

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Canada’s Petrochemical Industry in Trouble?

According to a new Stats Canada report, petrochemical feedstock production in Canada in January 2009 was down 54% compared to January 2008.

Petrochemical feedstocks, are used by the petrochemical industry to produce chemicals, synthetic rubber and a variety of plastics.

According to a speech 2005 speech by a key Dow Chemical executive. Dr. Ramesh Ramachandran, President of Dow Chemical Canada Inc. (North American Petrochemicals: Walking a Tight Rope) –

..the petrochemicals industry is Canada’s third largest within the manufacturing sector and Alberta’s second-largest industry. Petrochemicals are a nexus in Canadian industry that bridges the resource sector with manufacturing, retail, transportation and others.

Stats Canada reports that in 2008 the petrochemical industry (which uses petrochemical feedstock) was responsible for shipping product valued at $6.6B, and employing approximately 1,280 people.

A 54% reduction in petrochemical feedstock production is likely to reflect heavily on the health of this industry – anyone seen any news on this?

Canadian Federal Government Employee Stereotypes

The stereotypical government employee is usually characterized as “lazy”, “inefficient”, “in by 9 out by 4”.

With the tech downturn, a lot of people I know ended up in the government.  The general consensus among the ex-tech people who ended up in the government is that yes,  there are pockets of poor performers and demoralized individuals – but by and large – the majority of government employees are motivated and engaged in doing the best job they can.  The other observation of the ex-tech people inside the government is that the internal politics are very similar (although more pronounced in some departments more then others!) to the politics that they encountered inside Nortel.

On a personal level, my observations and experiences with Federal government employees include:

  • I have made submissions and worked with the NRC-IRAP team over the years.   I have found the NRC-IRAP team in general to be top-notch from the executives down to the ITA’s – they recognize the importance of their role in the future of Canada tech development and they work as an engaged and committed partner.
  • Stats Canada produces high quality research reports that I have found to be very insightful and valuable in supporting my various market analysis activities over the years.
  • The Passport office is a model of efficiency and customer orientation.  When I look back to the first passport I got compared to the last one a few years ago – they have made massive improvements.  In general I have found they are increasingly efficient and customer service oriented.    The last time I went in to get my renewed passport – in-spite of a full waiting room of people – I was in and out in less then 30 minutes.   I personally like the way they introduced an option for a taxpayer to pay extra for expedited services.
  • On the e-Government side, e.g. making it easy to find information and access services online, the government continues to make improvements year over year.   I have always been able to find the information I need online.   As an aside – I believe our government’s expertise in e-Government is a area we should be looking to export/develop into commercial businesses.

Politicians aside, in general it is my opinion that we have a pretty good group of people working for us in the Federal government.

The Current State of Canadian and Ottawa Business Incubators

Business incubation has been identified as a means of meeting a variety of economic and socioeconomic policy needs, which may include:

  • Creating jobs and wealth
  • Fostering a community’s entrepreneurial climate
  • Technology commercialization
  • Diversifying local economies
  • Building or accelerating growth of local industry clusters
  • Business creation and retention
  • Encouraging women or minority entrepreneurship
  • Identifying potential spin-in or spin-out business opportunities
  • Community revitalization

Business incubators typically provide a range of services to clients that may include:

  • Help with business basics
  • Networking activities
  • Marketing assistance
  • High-speed Internet access
  • Help with accounting/financial management
  • Access to bank loans, loan funds and guarantee programs
  • Help with presentation skills
  • Links to higher education resources
  • Links to strategic partners
  • Access to angel investors or venture capital
  • Comprehensive business training programs
  • Advisory boards and mentors
  • Management team identification
  • Help with business etiquette
  • Technology commercialization assistance
  • Help with regulatory compliance
  • Intellectual property management
  • Facilities (e.g. office space, specialized lab space) and associated business services (e.g. security, receptionist, meeting rooms, phone service, photocopiers, printers,  internet service)

Stats Canada released a report in late 2008 “The Business of Nurturing Businesses” which takes a look at business incubators in Canada based on survey data taken in 2005.   Some key findings from the report include:

  • Almost all business incubators are sponsored by economic development organizations, governments, academic institutions, i.e. tax money
  • 1 in 6 incubators offer facilities and on-site support services
  • Almost half of all incubators were focused on professional, scientific and technical services businesses
  • The top three most used services of incubators were: legal consultation, management guidance and assistence in obtaining financing

There are various lists of incubators in Canada, unfortunately none up-to-date, including:

In Ottawa, we have the following business incubators:

Unfortunately, with the exception of Carleton University’s Tony Bailetti, there is little/no information available on the public incubators relative to return on investment of the tax money in the operation of the incubators – which would lead me to believe that compelling results do not exist.

From the perspective of efficiency, it appears that our tax money is being spent a bit recklessly relative to overlapping mandates and services.    The Ontario government and Ottawa Municipal government have both being doing a review of how they are funding and delivering their economic development programs.   I hope that as part of this review, they look towards stronger collaboration and reduced overlap of services between Provincial and Municipal programs.

A future blog entry will examine how business incubators role will evolve/change in the context of Business Ecosystems.

References: