Misconceptions and inaccurate information amongst immigrant workers and Canadian HR professionals are contributing to the brain drain, according to a new study.
The small survey of Asian workers in Canada’s high-tech sector highlights many of the challenges facing Canadian companies that would like to use foreign workers to fill skills gaps.
Of the 47 Asian workers interviewed, 29 said they were thinking about moving to the United States, citing better compensation, lower taxes and access to more opportunities as primary motivations. The findings reaffirm much of the conventional wisdom about IT workers and their attitudes on working in Canada.
But the author of the study, Badrinath Rao, a professor of international studies and sociology at the University of New Brunswick, Saint John, also conducted detailed interviews with the respondents and found the reasons for wanting to move to the U.S. were often unfounded. For that matter, discussions with eight HR professionals also revealed a lack of understanding on issues critical to stopping the brain drain.
Canada and Canadian companies need to do a better job ensuring workers get the correct information about differences between Canada and the U.S., and better promote the benefits of working in Canada, including a higher quality of life.
Misconceptions abound. For example, most workers said it wasn’t difficult getting into Canada, but when they try to bring their families they experience problems, and it would be easier gaining entry in the U.S. But in comparison to the U.S., the processes are very similar, said Rao. In fact, in the U.S., the absence of an appeal can make it more difficult to bring family from home.
“I think it is incorrect to say that it is easier in the U.S. than it is here. But there is a perception that it is case.”
The study comes just in front of the expected release of a plan by the federal government to supply Canadian companies with more skilled labour. Ottawa’s strategy is reportedly going to include initiatives to bring more highly skilled immigrants to Canada.
Rao’s work indicates Canada must do a better job of educating immigrant workers about what Canada has to offer that the U.S. does not, said Rao.
On the global stage the U.S. will always have a bigger presence because it is a superpower. Its music and culture cover the globe and that holds an allure that, for the most part, Canada can do nothing about.
But there are other things that can be done to educate immigrant workers about what Canada has to offer. Companies like Nortel and Corel have powerful global presence but many people in India and China don’t realize they are Canadian, said Rao. Part of the reason for that is Canada doesn’t hold career fairs in countries like India where there is a pool of high-tech workers looking for work. It’s common practice for American, Australian, German and even Singaporean firms to organize fairs to recruit workers but Canada seldom does it, he said.
The lure of stock option packages also acts as a powerful force on workers looking to maximize their compensation. The Canadian Advanced Technology Alliance has been lobbying the federal government to change tax treatment of stock options in Canada in order to make them a better tool for companies to retain employees. But Daniel Sandler, a professor of tax law at the University of Western Ontario in London, said the perception that American tax rates on stock options are better than rates in Canada is false.
In a study published in the Canadian Tax Journal earlier this year, Sandler explained that since, in a large majority of cases, employees exercise their options and immediately sell them, the capital gains tax system in Canada means employees here are better off.
“The primary point is that in practice the tax treatment of stock options in the U.S. is harsher from the employees perspective,” he said.
It may be true that compensation rates are higher in the U.S. and employees may be given more options, but the actual tax treatment is generally more favourable here.
On the negative side, Rao’s study also revealed that the fundamental social differences between the Canada and the U.S. that many Canadians pride themselves on do push some immigrant workers to the U.S.
Asked if they appreciated that Canada’s superior level of health care and social security contribute to a higher quality of life for everyone, many said that since they don’t use those services they don’t feel they should pay for them. A particular problem with younger immigrant workers, who constitute a significant portion of the foreign-born IT workforce, and who use public services less and aren’t concerned about access to health care or public education for family members.
Rao also conducted interviews with several human resources professionals in the high-tech sector, several of whom said Canadian companies aren’t as dynamic as American companies and therefore will always struggle to hold onto talented labour.
“They did not seem to appreciate that all is not lost, and that we have our own strengths,” said Rao.
Some of the HR professionals tended to internalize many of the points that workers raise without looking at issues objectively and taking the time to see if the claims were true.
The small survey of Asian workers in Canada’s high-tech sector highlights many of the challenges facing Canadian companies that would like to use foreign workers to fill skills gaps.
Of the 47 Asian workers interviewed, 29 said they were thinking about moving to the United States, citing better compensation, lower taxes and access to more opportunities as primary motivations. The findings reaffirm much of the conventional wisdom about IT workers and their attitudes on working in Canada.
But the author of the study, Badrinath Rao, a professor of international studies and sociology at the University of New Brunswick, Saint John, also conducted detailed interviews with the respondents and found the reasons for wanting to move to the U.S. were often unfounded. For that matter, discussions with eight HR professionals also revealed a lack of understanding on issues critical to stopping the brain drain.
Canada and Canadian companies need to do a better job ensuring workers get the correct information about differences between Canada and the U.S., and better promote the benefits of working in Canada, including a higher quality of life.
Misconceptions abound. For example, most workers said it wasn’t difficult getting into Canada, but when they try to bring their families they experience problems, and it would be easier gaining entry in the U.S. But in comparison to the U.S., the processes are very similar, said Rao. In fact, in the U.S., the absence of an appeal can make it more difficult to bring family from home.
“I think it is incorrect to say that it is easier in the U.S. than it is here. But there is a perception that it is case.”
The study comes just in front of the expected release of a plan by the federal government to supply Canadian companies with more skilled labour. Ottawa’s strategy is reportedly going to include initiatives to bring more highly skilled immigrants to Canada.
Rao’s work indicates Canada must do a better job of educating immigrant workers about what Canada has to offer that the U.S. does not, said Rao.
On the global stage the U.S. will always have a bigger presence because it is a superpower. Its music and culture cover the globe and that holds an allure that, for the most part, Canada can do nothing about.
But there are other things that can be done to educate immigrant workers about what Canada has to offer. Companies like Nortel and Corel have powerful global presence but many people in India and China don’t realize they are Canadian, said Rao. Part of the reason for that is Canada doesn’t hold career fairs in countries like India where there is a pool of high-tech workers looking for work. It’s common practice for American, Australian, German and even Singaporean firms to organize fairs to recruit workers but Canada seldom does it, he said.
The lure of stock option packages also acts as a powerful force on workers looking to maximize their compensation. The Canadian Advanced Technology Alliance has been lobbying the federal government to change tax treatment of stock options in Canada in order to make them a better tool for companies to retain employees. But Daniel Sandler, a professor of tax law at the University of Western Ontario in London, said the perception that American tax rates on stock options are better than rates in Canada is false.
In a study published in the Canadian Tax Journal earlier this year, Sandler explained that since, in a large majority of cases, employees exercise their options and immediately sell them, the capital gains tax system in Canada means employees here are better off.
“The primary point is that in practice the tax treatment of stock options in the U.S. is harsher from the employees perspective,” he said.
It may be true that compensation rates are higher in the U.S. and employees may be given more options, but the actual tax treatment is generally more favourable here.
On the negative side, Rao’s study also revealed that the fundamental social differences between the Canada and the U.S. that many Canadians pride themselves on do push some immigrant workers to the U.S.
Asked if they appreciated that Canada’s superior level of health care and social security contribute to a higher quality of life for everyone, many said that since they don’t use those services they don’t feel they should pay for them. A particular problem with younger immigrant workers, who constitute a significant portion of the foreign-born IT workforce, and who use public services less and aren’t concerned about access to health care or public education for family members.
Rao also conducted interviews with several human resources professionals in the high-tech sector, several of whom said Canadian companies aren’t as dynamic as American companies and therefore will always struggle to hold onto talented labour.
“They did not seem to appreciate that all is not lost, and that we have our own strengths,” said Rao.
Some of the HR professionals tended to internalize many of the points that workers raise without looking at issues objectively and taking the time to see if the claims were true.
