The ICT Sector makes a substantial contribution to the Canadian
economy...
The Information and Communications Technologies (ICT) sector contributed $57.5 billion to Canadian GDP ($1997) in 2004, surpassing the peak reached in 2000. The sector still represents 5.5% of Canadian output, up from 4.0% in 1997.
Economic activity has picked up in the ICT sector in 2004 as GDP
grew by 3.3% compared to 1.5% in 2003. Since 1997, the sector has
grown by 8.4% per year, more than twice as fast as the Canadian
economy (3.6%). This faster growth of the sector also means that
the ICT indutries have accounted for 10.8% of the national growth
since 1997.
Lead by the telecommunications services industries, the ICT
services industries advanced by 2.5% in 2004, up from 1.5% in 2003.
The ICT manufacturing industries’output recovered by a
substantial 11.2% in 2004, bolstered by strong growth in the
wireless communications equipment (+41%) and electronic component
(+15%) industries. The ICT wholesaling, rental and leasing
industries kept growing, up by 5.7%.
After significant growth of 5.3% in 2003, employment in the ICT
sector continued to grow in 2004, but at a much slower rate of
0.8%. Total number of workers rose from 442,600 to 570,000 between
1997 and 2004, an increase of 29% (3.7% annual growth, compared to
2.2% economy-wide). In 2004, 3.6% of all Canadian workers were
employed by the ICT sector, up from 3.2% in 1997.
Most of the employment gains have occurred in the software and
computer services industries, where the number of workers was 64%
higher in 2004 than in 1997. Despite a slight increase of 2.0% in
2004, employment in the ICT manufacturing industries did not
recover from the substantial drops of 2001 and 2002. This resulted
in a shift in the industrial structure of the Canadian ICT sector
from manufacturing toward services.
ICT industries are the largest performers of private sector R&D...
After a substantial reduction in 2002 and tight control of
expenditures in the following years, R&D spending in the ICT
sector is expected to recover slightly in 2005, up by 2.0% to $5.2
billion*. This amount represents 38% of total
Canadian private sector R&D expenditures.
With planned R&D expenditures of $1.7 billion in 2005, the
communications equipment manufacturing industries (including wires
and cables) are still the largest spenders on R&D, accounting
for 32% of ICT sector spending and 12% of total Canadian private
sector R&D expenditures.
Employment in the ICT sector is characterized by a high level of
education. In 2004, 38% of all workers had a university degree,
compared to a national average of 21%.
The communications equipment manufacturing industries have the most
educated workforce (51%), followed by the software and computer
services industries (46%). The computer equipment and electronic
component manufacturing industries showed ratios of 36% and 33%
respectively, while the telecommunications services industries had a
ratio of 26%.
Employees in the ICT sector are also well compensated. These
workers earned on average $53,335 in 2004, which is 45% more than
the economy-wide average of $36,695.
Employees in the software and computer services industries are the
most highly paid. Average earnings in these industries were $58,069
in 2004. Workers in the instruments and communications equipment
manufacturing industries also earned 46% more than the Canadian
average.
ICT Manufacturing industries are highly export-oriented...
About two-thirds of ICT products manufactured in Canada are
exported. After three years of substantial declines, exports of ICT
goods recovered in 2004, by posting a gain of 10.5%. At $20.7
billion, they accounted for 5.0% of total Canadian exports of
goods.
The largest increases occurred in exports of communications
equipment (+14.2%) and instruments (+13.3%). Communications
equipment also represented the largest proportion (30%) of
all exports of ICT goods.
Despite an increase of 7.4% in 2004, shipments to the United States
dropped from $31.3 billion in 2000 to $14.6 billion in 2004. During
this period, the share of our largest trade partner in our exports
fell from 83.9% to 70.2%.
Shipments to the Asia-Pacific region continued to grow in 2004,
totalling $2.3 billion or 11.3% of all exports (up from 4.9% in
2000). Exports to the European Union also continued to increase in
2004, reaching $2.8 billion or 13.4% of total exports (as compared
to 8.7% in 2000).
...but Canada still incurs a sizeable trade deficit in ICT Goods.
Canada’s trade deficit in ICT goods increased by 8.6% in
2004, reaching $21.7 billion, or 16.5% more than in 1997. This is
the highest historical deficit in ICT goods. The trade surplus in
ICT services declined by 30.5% to $2.1 billion. The resulting trade
deficit in ICT goods and services increased by 15.6% to $19.6
billion.
Computer equipment alone accounted for 41% of the trade deficit
observed in ICT goods in 2004, followed by audio and video
equipment (23%), instruments (20%) and electronic components (19%).
Due to substantial declines in imports of electronic components in
the early 2000’s, this product group no longer represents the
largest portion of this trade deficit.
Information and Communications Technologies Sector*
ICT Manufacturing:
Computer Equipment Manufacturing
Communications Equipment Manufacturing
(including wired and wireless)
Audio and Video Equipment Manufacturing
Electronic Component Manufacturing
Instruments Manufacturing
Communication Wire and Cable Manufacturing
Commercial Industry Machinery Manufacturing
ICT Services:
Software and Computer Services (including data processing)
Telecommunications Services
Cable and Other Program Distribution
ICT Wholesaling, Rental and Leasing
*Based on the North American Industry Classification System
(NAICS).
Note to Readers: Some data reported in this article may be
slightly different from data reported in previous publications as
they include the latest revisions made by Statistics Canada to data
previously published.
*Based on a survey conducted by Statistics
Canada from June to December 2004.back
Business Information by Sector
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