A growing number of top tech companies are establishing engineering hubs in Toronto and Vancouver. In their pursuit of developing innovative products, they’re turning away from well-established tech hubs such as the San Francisco Bay Area and New York.
But what makes these Canadian cities such ideal hotspots in the eyes of the largest tech companies?
We break it down below and show you why you absolutely need to consider the two cities for your own tech business. But first, a quick overview:
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Cost of Living
Cost of living accounts for basic expenses such as housing and transport. While your personal expenses may be higher or lower, the cost of living data shows how expensive it is to live in each city on average. This is important for tech workers to determine their net earnings after paying their living costs. Ideally, low costs of living are favorable.
Toronto
According to RentBoard.ca, the average monthly cost of rent for a one-bedroom apartment is $2,011. A two-bedroom house, on the other hand, has a rental rate of $3,489 per month.
Transportation costs are also high, with public transport costs averaging $258.55 per month. But it is possible to live in Toronto for less if you share the costs with a partner or housemate, which is an option that many consider.
Vancouver
Figures from RentBoard.ca show that the average rent for a one-bedroom apartment in Vancouver is $2,353 per month. This is slightly higher than in Toronto. However, the average two-bedroom house costs $2,435 monthly, which is significantly lower than in Toronto.
LowestRates.ca figures show that average public transportation costs in Vancouver are $214 per month. This is again slightly lower than in Toronto.
Taking all the data into account, the overall cost of living in Vancouver is lower, though still comparable to Toronto.
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Average Salary
Average salary data is an indicator of the labor costs in each city. For the purposes of this article, we provide the average salary for Software Engineers.
The quick take: Junior talent is more affordable in Toronto (by roughly 12%), whereas Senior talent is more affordable in Vancouver (by roughly 15%).
Toronto
Statistics from ca.indeed.com show that the average wage for Junior Software Engineers in the province of Ontario is $51,845. Likewise, the average salary of a Senior Software Engineer living in Toronto is $113,485 (all figures in Canadian dollars).
Vancouver
Indeed suggests the average in the province of British Columbia is $58,273 for Junior Software Engineers while Senior Software Engineers in Vancouver earn on average around $98,630 (all figures in Canadian dollars).
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The Engineering Market
Studying the overall size and growth of the engineering market demonstrates each city’s contribution to the industry. It is an important factor companies consider before moving in to determine the locations that are likely to attract the highest concentration of talent.
Toronto
The engineering market in Toronto is booming. A 2018 study conducted by the CBRE group suggested that Toronto had the fourth largest tech talent pool in North America.
Between 2012 and 2017, Toronto also had a massive 51.5% increase in the total number of tech workers living in the city. It’s now a key player in the world of tech, rivaling the Bay Area for overall growth.
In addition to this, Government funding for tech startups in Toronto has continued to increase. Toronto-based startups now receive some of the highest funding of any city in Canada. Shopify and Hootsuite are two of Toronto’s most prominent startup successes to date.
Vancouver
Like Toronto, Vancouver has experienced an influx of tech companies opening engineering hubs. The 2018 CBRE study ranks Vancouver 23rd on the total tech talent pool in North America — compared with Toronto’s fourth place. Although it ranks lower, Vancouver is much smaller than most cities on the list.
Furthermore, Vancouver experienced the eighth largest growth in the overall tech talent pool between 2012 and 2017 at 30.7%. As a result, Vancouver is right behind the San Francisco Bay Area by just 0.3%. This is a massive accomplishment for a city of its size.
Overall, the CBRE report ranks Vancouver as the second-best city in Canada — behind only Toronto.
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Talent Pool
The talent pool refers to the number of skilled workers available in each city. This often has direct links to universities in the local area. It’s good for companies to move into areas with large talent pools – this enables them to hire developers on more affordable salaries, faster.
Toronto
Toronto is home to ten of the best universities in the world. Each university has a considerable number of STEM (science, technology, engineering, and mathematics) students that provide the tech industry with up-and-coming talent every year.
Thanks to Canada’s more welcoming immigration policies, tech companies are finding it easier than ever to hire international talent as well. Despite a higher cost of living, it’s clear to see why many tech companies are moving their engineering hubs to Toronto.
Vancouver
Vancouver is home to two universities, which feature on the QS World University Rankings. They are the University of British Columbia and Simon Fraser University. Each university provides local tech companies with talented STEM graduates every year.
Like Toronto, Vancouver benefits from Canada’s friendlier immigration policies that allow tech companies to quickly scout and hire international talent.
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Happiness and Wellbeing
Happiness and well-being are hugely important when deciding to move to another city. It’s generally a good indicator of the overall quality of life. If you intend to ask some existing workers to move to get your new hub working, then this factor will be key in the discussion.
Toronto
According to a recent study by UBC’s Vancouver School of Economics and McGill University, Toronto does not rank highly for happiness in comparison with other cities in Canada. This conclusion comes from researchers looking at the life satisfaction of 1200 communities across the country.
Despite this research, Toronto has a lot to offer its residents. It has a wide range of public transport services throughout the city, including buses, streetcars, and an impressive subway system. Toronto is also home to several spectacular parks. This makes urban living feel cleaner and less constricting than in other metropolitan areas. If you have an interest in nature and the outdoors, the incredible Niagara Falls are just a car ride away.
There’s no shortage of community events in Toronto either. From the annual Impact STEM Day networking event to the Winter Light Exhibition, there’s an event for everyone all year round. During the summer months, a trip to see The Blue Jays — Toronto’s Major League Baseball Team — at the Rogers Centre downtown is a Torontonian tradition.
Vancouver
Like Toronto, Vancouver doesn’t have a high rating for overall happiness. Nevertheless, metropolitan areas generally ranked lower overall, so this is a common trend throughout the country.
Despite this, Vancouver has a variety of activities on offer that make for a positive living experience. This includes museums, parks, water tours, and so much more. The city also boasts an incredibly accessible and reliable transport system. It has express train services, a vast bus network, as well as SeaBus services for water transportation. Compared with Toronto, Vancouver’s transportation system is less complex to account for the city’s smaller size.
Located north of the city, Vancouver’s snow-capped mountains offer a wide array of activities for its residents. Whether you attend one of three spectacular ski resorts or drive to the glacier lakes, there are plenty of activities to choose from. Vancouver also has a vibrant sports scene with their local Minor League Baseball Team, the Vancouver Canadians.
Overall, there’s no shortage of activities to do in both Vancouver and Toronto. Next, we will have a look at some major tech companies, and why they chose one of the two cities for their tech hub.
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Which Tech Companies Have a Base in Toronto?
Many large tech companies have already chosen Toronto as the home for their engineering hubs. Below are a few high-profile examples.
Uber
In 2019, Uber opened an enormous office space in Toronto to house one of ten engineering hubs around the world. It spans 80,000 square feet over a total of five floors. The hub is also home to around 250 total employees.
Uber’s new hub was part of a $200 million investment that aimed to help grow Toronto’s tech market. It offers graduates a chance to find employment in their hometown. Moreover, it focuses on innovating Uber’s grocery delivery service, and develops insightful web-based tools for the business.
Amazon
In 2018, Amazon opened a new 113,000-square-foot office space in downtown Toronto to accommodate their tech and engineering hub. This created around 600 jobs in fields such as software development, AI, and cloud computing.
Speaking in a press release, Amazon’s Site Lead and Head of Amazon Advertising in Canada said that “Toronto has a well-educated and diverse workforce, and there’s a real culture of innovation here.”
Lever
Human resources software developer, Lever, also chose Toronto to set up a second headquarters. After considering popular locations like New York and Atlanta, the CEO of Lever, Sarah Nahm, said Lever wanted to do something different.
Like other tech companies, Lever’s intention is to tap into Toronto’s growing technology sector.
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Which Tech Companies Are Located in Vancouver?
On the other hand, some tech companies from across the globe have already chosen Vancouver as the ideal location to open their engineering hubs. Below are a few examples.
Microsoft
2016 saw the grand opening of Microsoft’s 142,000 square foot engineering hub in Vancouver, allowing Microsoft to almost double its workforce. Their motives behind choosing Vancouver were due to the city’s active technological scene and generous local talent.
Microsoft’s Vancouver engineering hub now focuses on some of its most popular services. These include Skype, OneNote, and apps for HoloLens.
Salesforce
Sales software giant, Salesforce, is no stranger to Vancouver. They’ve had offices in the city since 2012. However, in 2019, Salesforce decided to expand its presence by building a new center — one that facilitated more innovative projects.
Their existing Dreamforce office in San Francisco, California, resembles the newly built center. As with many other top tech companies, Salesforce chose Vancouver because of its growing prominence as a tech hub.
Tile
Tile is yet another tech giant to open an engineering hub in Vancouver. It’s their first significant office opening outside of San Mateo, California. Their new hub is a bedrock for innovation with a team of engineers working on cloud services and expanding their Bluetooth product range.
Speaking in a press release for Betakit, CEO of Tile, CJ Prober stated that his choice to expand into Vancouver was due to Canada’s growing influence as a tech hub: “Expanding here aligns perfectly with our plan to add more Tile-embedded partners and app-based solutions.”
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Time Zone: Equivalent US City
Toronto
On the East side of Canada, Toronto lines up with New York. Based on this, U.S. companies based on the East Coast may find that Toronto is a good fit for an engineering hub location.
Vancouver
If you’re based in San Francisco and looking for a new engineering hub location, Vancouver may be pretty tempting. Its location within the same time zone means ease of setting up cross-hub meetings.
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Where Should You Start Your Own Engineering Hub?
Taking into consideration the above, there are a few distinguishable differences between Toronto and Vancouver. Both cities have seen massive growth as tech hubs and have therefore attracted some of the world’s largest tech companies.
Toronto has a larger population, more universities, and thus a more extensive selection of local talent than Vancouver. It may be preferable for larger tech hubs. Nevertheless, Canada’s welcoming immigration laws make it easy to hire international talent in both cities.
Average living costs are on the expensive side in both locations; however, higher average salaries compensate for this. Senior Software Engineers seem to be more affordable in Vancouver by around 15%, whereas Junior Software Engineers are more affordable in Toronto. Bear this in mind when making your choice — or look further afield through hiring remote developers.
Happiness and well-being isn’t the greatest strength of either city — but this is part of a broader trend among metropolitan areas across Canada. Nevertheless, both cities have a lot to offer their residents in terms of transport links, community activities, and green spaces.
Toronto has a wide range of unique community events. This includes popular annual events and fantastic attractions just outside the city like Niagara Falls. Similarly, Vancouver has a fantastic range of outdoor activities in the nearby mountains and around the city.
Ultimately, both Toronto and Vancouver are ideal locations to set up your new engineering hub. Both cities are brimming with opportunities, and whether your company is based on the East or West Coast of the US, you have time zone-equivalent options. As such, both Toronto and Vancouver should be on your short-list of potential locations to launch or grow your tech company.
You can also try Arc, your shortcut to the world’s best remote talent:
⚡️ Access 350,000 top developers, designers, and marketers
⚡️ Vetted and ready to interview
⚡️ Freelance or full-time
