Murad Al-Katib is the president and CEO of AGT Food and Ingredients, and a board member at the Century Initiative.
Canada has much to offer the world. In its 2022 report, the Narwhal Project – which looks to identify Canadian firms with the ability to scale up and reach world-class status – identified 50 Canadian candidates. It also celebrated three companies that graduated to become unicorns – a company that has grown to a valuation of $1-billion.
But these companies are in the minority. On the whole, Canada faces significant challenges scaling small and mid-sized firms. Despite a world-class education system and work force, we are rarely home to world-class companies.
We have the drive. We have the talent. We have the skills and investment capital.
So what is holding us back?
In our 2022 National Scorecard on Growth and Prosperity, the Century Initiative took a close look at economic growth – at productivity, the scaling of mid-sized firms and at innovation.
We found much work remains to be done.
From a business perspective, we found Canadian private-sector spending on R&D lagged, with businesses spending only 0.81 per cent of gross domestic product on the development of new products, services and ways of doing business.
We found challenges to Canadian productivity continue to exist – our GDP an hour worked came in at US$56.61 in 2020, compared with France, which saw GDP for every hour worked of US$67.60.
And we saw we remain perilously vulnerable to economic shocks, with Canadian household debt levels significantly ahead of the OECD average.
This is a problem. The demographic trends do not look good for Canada. As our population ages, the share of our population at working age shrinks. Without bolstering productivity, our economy – and our public services – will come under severe stress, as fewer and fewer workers support ever-growing budgets.
At Century Initiative, we believe we have the solution: immigration. It is a potential solution for not only our demographic challenges but our economic challenges as well.
According to the Business Development Bank of Canada, immigrants are much more likely than those born in Canada to engage in entrepreneurial activities. This makes sense: Immigrants are a self-selected group who have decided to leave behind their country of origin to start a new life and seek out opportunity.
As a group, they bring a risk tolerance and willingness to bet on better that Canadian business can sometimes lack. And they already deliver for Canada.
Research recently conducted by Century Initiative shows one-third of Canadian private tech companies that have scaled successfully, and positioned themselves to be global leaders, were founded or co-founded by immigrants out of proportion to their share of the population.
And the impact is not only felt in the tech sector. In every sector, from logistics to retail to import and export, immigrant-owned and immigrant-founded businesses employ Canadians, generate Canadian economic value and build up our national prosperity. My own company, AGT, is one such company. There are many others. We should understand this as a source of national strength.
Newcomers do not only bring their talent and drive to Canada – they bring new ways of thinking and connections to their country of origin. And they bring a willingness to take risks that we badly need.
To build on this strength, there are critical steps that governments can take right now.
First is enhancing our existing processes to target and select immigrant innovators and entrepreneurs. This should include streamlining applications for high-potential immigrant entrepreneurs or improvements to the existing Start-Up Visa program. It might also include recognizing self-employment in Canada as a qualification for permanent residence through the Canadian Experience Class.
Our second priority should be to improve supports for immigrant entrepreneurs to start and scale businesses. Moving to a new country is difficult – and starting a business there, in a thicket of unfamiliar rules, regulations and bureaucracy, can be more difficult still.
Immigrant entrepreneurs can also “fall through the cracks” of existing support services. Settlement agencies do not always provide appropriate levels of support to immigrant entrepreneurs, and organizations that encourage entrepreneurship are poorly equipped to provide services to immigrants.
This must be changed – and change starts with these agencies themselves.
And finally, we must strengthen our value proposition to top talent from abroad. In our most recent National Scorecard, we found Canada’s brand to newcomers remains one of the strongest in the world – but we can strengthen it further still. In the Trump years, we enjoyed an advantage as a North American destination that was friendly to newcomers. Under the Biden administration, we face stiffer competition.
Canada is home to some of the world’s most highly skilled workers – but despite Canadians’ skills, we are neither making the investments we need to make nor taking the risks we need to take to be global leaders.
New Canadians – with their drive and ambition – can help shake us out of our Canadian complacency and become determined to grow and succeed.
We must recognize immigration as the strong foundation on which our prosperity rests, and build on it.
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