Great Resignation very real for local tech sector, says new report

Tech companies have experienced attrition of nearly one-fifth of workforce over past year

Great Northern Way is home to some of B.C.'s notable tech companies | Chung Chow, BIV

There’s been debate the past two years whether the “Great Resignation” manifested in Canada to the same degree in the U.S. and other countries, where data shows people leaving their jobs amid the pandemic at significant scale.

Data from last year showed Americans were departing their jobs at about three times the rate of Canadians.

But a new report from Vancouver-based Tech and People (TAP) Network Association reveals the Great Resignation is very real for Canada’s technology sector.

Tech companies saw 18.5 per cent of their own workers depart over the past 12 months, based on responses in a Sept. 20 survey.

That rate of attrition was felt mostly sharply in e-commerce (32.5 per cent), visual effects and animation (27.7 per cent), and AI, data science, machine learning and robotics (24.3 per cent).

“Organizations reacted and increasingly dangled both cash and non-cash incentives to attract and retain talent,” the survey stated. “The incentives most commonly used were sign-on bonuses, retention bonuses and new-hire stock grants.”

Other perks include more flexibility for working from home, with 99 per cent of respondents offering remote working either partially or fully. Another 78 per cent of respondents are allowing workers to live in a different province than where the company’s office is based.

TAP also found that in-office perks like free food and drinks are on a downward trend.

Co-working space expert Wayne Berger told BIV earlier this months those types of in-office perks have had a limited effect drawing workers.

“They want choice and flexibility in where and when they conduct their work,” said the CEO of IWG plc’s North America and Latin America division, whose company offers 3,500 co-working spaces across the globe.

“The issue really comes down to the fact that a large percentage of the workforce does not want to go to an office five days a week, each and every week.”

Meanwhile, the survey showed tech-sector salaries moved at a clip amid ongoing labour shortages.

Salaries on average grew by 6.5 per cent over the past year – up from 3.8 per cent growth during the previous five-year average.

“The reality is that if you work in tech, it was raining jobs this past year,” TAP Network CEO Stephanie Hollingshead said in a statement.

“The trifecta of strong sector growth, record-breaking levels of venture capital and local talent being lured away by international companies hiring for remote roles has put significant pressure on Canadian companies to compete on salaries.”

Hollingshead said companies should expect continued pressure on employee salaries.

The survey results come at a time parts of the tech sector – both in B.C. and globally – have been grappling with layoffs.

Vancouver-based Thinkific Inc. (TSX:THNC) cut 20 per cent of its 500-person roster back in March after the company completed what it described as “a rigorous review of our organizational structure.” 

That was followed by significant layoffs this past summer at Unbounce Marketing Solutions Inc., Article (TradeMango Solutions Inc.) and Hootsuite Inc.

“More and more companies will cut staff in the months ahead,” Ilya Brotzky, CEO of the VanHack Technologies Inc. recruitment firm, told BIV after Hootsuite cut 30 per cent of its workforce in August.

“I anticipate the correction to last until the new year.”

He said the rate at which recently laid-off workers get hired at another company will depend on their role.

“Many companies are still hiring tech talent, for example,” Brotzky said. “But other roles like talent acquisition or customer service might be a bit slower to find new opportunities.”

torton@biv.com

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