While B.C.'s tech sector has become one of the province's largest industries, it's still not reaching its full economic potential.
According to KPMG's B.C. Technology Report Card released in June, bigger infusions of capital and research investment and a stronger focus on talent development could increase the industry's contribution to the B.C. economy by 27%.
The industry is already B.C.'s second-fastest growing sector. It grew nearly 40% over the past decade. Total revenue from the sector has risen 56%, and technology exports have risen 86% in the same period of time. It now employs more than 84,000 people.
But the report suggested it continues to underperform in comparison with North America's technology sector overall. Its share of B.C. GDP is 5.9%, which is 21% below the Canadian average of 7.5% and 70% below the U.S. tech sector's 10% share of the country's economy.
With small businesses making up the vast majority of B.C.'s technology companies, the report suggests that B.C. is suffering from a dearth of experienced senior industry leaders and middle managers needed to create medium and large companies.
The limited number of large tech companies in B.C. has also affected the level of R&D investment. While research and development spending has risen to 1.5% of B.C. GDP, it's still 40% below relative R&D spending levels in Ontario and Quebec. As a result, the amount of intellectual property originating in B.C. also remains comparatively low with B.C. getting 30% fewer patents per capita than the national average.
Finding ways to help successful tech entrepreneurs build their businesses into larger entities and encouraging investment in research and development are among the keys to boosting the sector's economic output.
If its relative contribution to the economy grew to match the national average, the sector would contribute an additional $2.5 billion to the B.C. economy and provide another 23,000 high-paying jobs. Not only could the industry's revenue rise by $5.1 billion, total wages would increase $1.4 billion, providing an economic base for $350 million in added income tax revenue for the provincial and federal governments.
