The ICT Sector makes a substantial contribution to the Canadian
economy...
The Information and Communications Technologies (ICT) sector
contributed $60.6 billion to Canadian GDP ($1997) in 2005 -
accounting for 5.6% of Canadian output, up from 4.0% in 1997.
Economic activity has picked up in the ICT sector in 2005 as GDP
grew by a significant 5.6% compared to 3.9% in 2004. Average annual
growth in this sector has been 8.0% since 1997, more than twice as
fast as the overall economy (+3.5%). This faster growth also means
that the ICT industries have accounted for 10.6% of the Canadian
GDP growth since 1997.
After a significant recovery of 11.2% in 2004, the ICT
manufacturing industries grew by 14.1% in 2005, bolstered by the
wired (+37%) and wireless (+23%) communications equipment
industries. Lead by the telecommunications services industries, GDP
in the ICT services industries increased by 3.4% last year, up from
2.2% in 2004. Growth slowed down in the ICT
wholesaling/rental/leasing industries as ouput advanced by 3.3% in
2005, down from 5.7% in 2004.
After significant growth of 5.3% in 2003, employment in the ICT
sector continued to grow in 2004, but at a slower rate of 2.4%.
Total number of workers rose from 442,500 to 579,400 between 1997
and 2004, an increase of 31% (3.9% annual growth, compared to 2.4%
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 70%
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 substantial declines in the early 2000’s,
exports of ICT goods increased for a second consecutive year in
2005, up by 8.8%. At $22.6 billion, they accounted for 5.2% of
total Canadian merchandise exports.
The largest growth occurred in exports of wired (+20.4%) and
wireless (+16.9%) communications equipment. Together, these
two groups accounted for one third of all Canadian exports of
ICT goods.
Despite some recovery over the last two years, shipments of ICT
goods to the United States dropped from $31.3 to $15.4 billion
between 2000 and 2005. During this period, the share of our largest
trade partner in our exports of ICT equipment fell from 83.9% to
68.2%.
Shipments to the Asia-Pacific region continued to grow in 2005,
totalling $2.7 billion or 12.1% of our exports of ICT goods (up
from 4.9% in 2000). Exports to the European Union also continued to
increase in 2005, reaching $3.1 billion or 13.6% of our 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 decreased by 3.8% in 2005
as our exports grew more quickly than our imports. Totalling $20.9
billion, this deficit was 22.0% higher than the 1997 level of $17.2
billion.
Computer equipment alone accounted for 45% of the trade deficit
observed in ICT goods last year, followed by audio and video
equipment (25%) and electronic components (20%). Due to substantial
declines in imports of electronic components in the early
2000’s, this product group no longer represents the largest
portion of the 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
Contact: Sylvain de Tonnancour, ICTB, (613) 954-2971