JANUARY 2018 Talent Fuels Tech...strategies that might better connect the supply of talent...

Connecting the GTA’s tech sector with top talent

Talent Fuels Tech

JANUARY 2018

Talent Fuels Tech | MaRS Discovery District 1

Located in the heart of Canada’s largest and the world’s most diverse city, MaRS is uniquely placed to lead change. As the world’s largest urban innovation hub, MaRS is a place where today’s moonshots become tomorrow’s breakthroughs. It’s a launchpad for startups, a platform for researchers and a home to innovators. MaRS helps these entrepreneurial networks advance the world together.

MaRS Discovery District 101 College Street Toronto, Ontario, Canada M5G 1L7

T: 416 673 8100 F: 416 673 8181


PAGE 3

Foreword

PAGE 4

Executive summaryPAGE 4 To increase and enhance the pool of talent, the GTA tech sector must reshape its hiring practices and build the mindsets needed for growth

PAGE 5 A talent strategy for the GTA’s tech sector

PAGE 7 The Greater Toronto Area tech sector is primed for growth

PAGE 9 For the Toronto region to win the talent race, job seekers and employers must be alignedPAGE 9 Who are the job seekers?

PAGE 10 Job seekers and employers are looking in different places

PAGE 12 Job seekers are looking for income

PAGE 13 Job seekers don’t know much about startups—but do believe they’re risky

PAGE 15 Creating mindsets that matter to both employers and job seekers is key to cracking the employment codePAGE 15 Employers are looking for hybrid skills

PAGE 17 What are the mindsets for growth?

PAGE 18 Cultural fit is preventing job seekers from under-represented groups from accessing opportunities

PAGE 19 Hiring for mindsets should replace hiring for cultural fit

PAGE 20

A talent strategy for the GTA’s tech sectorPAGE 20 Moving beyond technical skills: Job seekers need to accelerate the development of key mindsets for growth to complement technical acumen

PAGE 20 Competitive compensation retains top talent: Organizations must be intentional about competitive compensation packages and opportunities for employee growth and development

PAGE 21 Intentionally integrating diversity into the talent pool: Develop a sector-wide strategy to attract and retain a diverse workforce of top talent

PAGE 22 Sourcing talent: Build a diverse talent pipeline for GTA tech-sector employers

PAGE 23 Crafting the Toronto region’s tech story: Create a sector-wide marketing campaign for the GTA’s booming tech ecosystem to attract top talent

PAGE 24 Conclusion

PAGE 25 Appendix: MethodologyPAGE 25 CHAID analysis explanation

Contents


ForewordToronto has emerged as a global force in the innovation economy, with MaRS leading the charge. As cities around the world increasingly become the drivers for growth, it is imperative that Toronto capitalizes on growing international interest and seizes the opportunity to transform our region into a leading centre of entrepreneurial success.

Talent fuels the innovation economy. While highly skilled workers and serial entrepreneurs are moving to Toronto in ever greater numbers, attracting and retaining the best talent remains one of the major chokepoints to success and scalability for Canadian tech firms.

As the world’s largest urban innovation hub, MaRS has a significant role to play in addressing this issue. MaRS is uniquely positioned to drive network effect among global stakeholders while also convening the Toronto region’s innovation supply chain.

This report is the product of collaboration with many partners. It puts forth a vision of how Toronto can succeed in the innovation economy, identifies some of the challenges and outlines potential solutions to overcome them.

I believe this is Canada’s moment. As Canada’s commitment to diversity continues to resonate positively beyond our borders, Toronto and MaRS have a clear window of opportunity. We must leverage this advantage to attract the talent that will fuel Made-in-Canada innovators as they seek to win on a global stage.

I hope you will join us in this effort to ignite the region’s innovation ecosystem.

Yung Wu CEO, MaRS Discovery District


Executive Summary

While rapid growth in Canada’s innovation ecosystem continues to create jobs, advances in technology continue to disrupt our economy and demand that our workforce adapts to constantly changing conditions. MaRS recognizes that for Canada to remain globally competitive, the Greater Toronto Area’s technology employers must be able to connect with a highly competitive talent pool that is trained with the skills and mindsets necessary for the future of work.

Many leading countries have focused their talent strategies at the regional level and have done so with great success. We seek to replicate this approach by focusing our research and strategic efforts on the Greater Toronto Area (GTA). By implementing actions derived from our market research and subsequent strategy, our goals are to increase the pool of top talent from which our tech

companies can source and hire employees, and to help build a truly inclusive regional economy through the tech ecosystem.

The behaviours, aspirations and opinions of job seekers in the GTA are complex, but understanding these dynamics is essential to the future performance and productivity of enterprises within the region’s tech ecosystem. To better help understand these dynamics, MaRS undertook a comprehensive research study that surveyed Toronto tech talent to understand their job-seeking behaviours and held qualitative focus groups with employers. This report incorporates insights gained from our research to define appropriate strategies that might better connect the supply of talent (tech-sector professionals) to the demand for talent (employment opportunities among ventures and corporations) within the innovation ecosystem in the GTA.

To increase and enhance the pool of talent, the GTA tech sector must reshape its hiring practices and build the mindsets needed for growthIn our survey of technology workers, we found that 91% were currently employed, but that 50% of those employed workers were actively looking for another job. These job seekers were more likely to be between the ages of 22 and 35, more likely to belong to a visible minority group and more likely to be born outside of Canada. Older, seasoned workers were less likely to be job seekers.


There are significant mismatches between employers and job seekers in terms of their sourcing activities and employment expectations.

• Ventures are spending a greater amount of their time sourcing talent through internships, campus recruitment and referral programs targeting job seekers with hard skills. However, to find jobs, job seekers are mainly using online portals such as LinkedIn and Indeed, as well as referrals from friends.

• Job seekers have misconceptions about, and little awareness of, the startup ecosystem. When asked why they do not want to work for startups, many job seekers acknowledged that they simply don’t know about many ventures, leading to a struggle with brand recognition for ventures. In addition, many employers believe that job seekers only want to work for large corporations (the “Big 5”), when in reality the majority of job seekers want to work for small- or medium-size companies.

• Talent considers compensation as the strongest driver to become job seekers, whereas ventures and corporations believe that job seekers consider quality of work and their ability to make an impact to a higher degree.

These mismatches alone would create problems in sourcing and hiring for talent. But two additional areas of concern are highlighted in our research. We heard that tech-sector employers place a strong emphasis on cultural fit, at times prioritizing fit over hard skills when making final hiring decisions. This emphasis creates barriers to the inclusion of groups that are not currently represented in these workplaces—for example, visible minority groups and immigrants to Canada who are under-represented in tech-sector companies.

Our evidence indicates that job seekers in Toronto are more likely to be visible minorities and suggests they may be seeking more inclusive workplace cultures.

We also heard that at the core of their hiring goals, ventures seek employees who can operate in hybrid roles: those who have both the hard skills and the mindsets for growth necessary to take scaling ventures to the next level. We define having a “mindset for growth” as having the skills necessary to respond to the constantly changing forces in our new economy, including the ability to work cross-functionally across teams, the ability to work with risk in complex environments, and a lifelong interest and curiosity in taking on different roles, among other skills. Though employers are recruiting with an emphasis on technical skills, they are hiring talent based on the mindsets required to thrive in their organizations. But our current system isn’t designed to efficiently showcase, much less acquire, these mindsets for job seekers.

A talent strategy for the GTA’s tech sectorEcosystem stakeholders must work together to enhance the ability of tech-sector employers to connect with job seekers in Toronto. Specifically, we recommend that MaRS, governments, post-secondary education institutions and industry must focus their efforts to:

• Increase the pool of skilled talent seeking opportunities in high-growth technology companies by hiring, retaining and promoting qualified diverse candidates;

• Attract top talent from other sectors into the tech sector;

• Ensure that more skilled professionals are up-skilled with the mindsets required for success in these environments; and

• Steward a bold, global narrative for Toronto as a lucrative destination for top talent.

The following tactical actions are required to help meet the end goal of increasing the tech ecosystem talent pool.

1. Accelerate the development of key mindsets to complement technical acumen through work-integrated learning opportunities

As employers build teams for the future of work, there is a high demand for candidates who have both technical skills and mindsets for work in the rapidly evolving tech sector. These mindsets enable talent to work collaboratively, think critically to solve new problems, remain agile in their approaches to challenges, take risks, and pivot their approaches as needed. While various methods can be used to develop these mindsets, there is a clear need to accelerate this development among job seekers. There is a belief that these mindsets can be developed intentionally through on-the-job experiential learning rather than gained through formal educational settings alone. Talent stakeholders, including employers, governments, and post-secondary education institutions, must work together to ensure that work-integrated learning opportunities are accessible for job seekers at all points in the array of talent spectrum.


2. Recognize that top talent is drawn by high-skilled jobs that promise competitive wages and opportunities for growth and advancement

Our research has shown that compensation is the strongest driver for job seekers. Employers must review market rates for talent and directly address compensation concerns with their teams. While we understand that salaries are dependent on the type of role and the experience required, employers must also keep compensation and cost-of-living expenses in mind when looking to retain top talent in the GTA.

3. Develop a sector-wide strategy to attract and retain a diverse workforce

Toronto’s tech-sector companies need both sector-wide and employer-specific supports to attract, actively integrate and successfully retain a diverse pool of talent. According to our research, job seekers interested in Toronto’s tech sector are often visible minorities and immigrants to Canada. Structural supports are required for workplaces to acknowledge the inherent biases that exist in traditional sourcing systems. Specifically, hiring for cultural fit has created a barrier to entry for job seekers who are visible minorities and who may not already be represented in workplaces. A sector-wide diversity-and-inclusion working group should be created

to co-design a comprehensive approach to attracting, integrating and retaining a diverse pool of talent in the Toronto tech ecosystem. Additional efforts should be employed by workplaces to remove hiring bias, including discouraging hiring for cultural fit, placing greater emphasis on hiring for mindsets for growth, and removing other barriers that prevent diverse workers from being fully included in the workplace.

4. Build a diverse talent pipeline for GTA tech-sector employers

Job seekers primarily use online platforms to find work opportunities. As such, employers must place a larger emphasis on online recruitment strategies. While employers are currently expending resources on in-person recruitment activities such as attending job fairs and undertaking university and college campus recruitment, employed job seekers are mainly looking for opportunities online. Employers and job seekers would both benefit from access to a common marketplace for tech-sector jobs. Such a marketplace would enable employers to find talent where they are, through common channels as well as showcase lesser-known ventures to a diverse pipeline of job seekers. MaRS can leverage its awareness among job seekers to lend credibility to this marketplace, creating a one-stop shop for the best jobs in the Toronto tech ecosystem.

5. Create a sector-wide marketing campaign for the Toronto region’s booming tech ecosystem to attract top talent

The GTA’s tech sector needs a multi-pronged marketing approach that educates job seekers on the realities of the labour market and the advantages of working for scaling ventures. Such a campaign will help top talent to become more knowledgeable about ventures, increasing the likelihood that they will seek employment in the tech sector while also increasing the sector’s pool of engaged talent. All stakeholders must align their communications to ensure that talent is presented with a strong, coherent narrative about the advantages of working in GTA’s tech sector.

The opportunity for the stakeholders in the Toronto region’s technology sector to work together is here. These five recommendations would comprehensively enhance the connection between tech-sector employers and job seekers in the GTA to build a region without rivals.


The Greater Toronto Area tech sector is primed for growth

The world’s highest growth cities are becoming economic drivers for their respective countries: the Toronto region is primed to lead Canada’s competitiveness on a global stage.

With ever-expanding information networks, top talent is increasingly drawn to cities that offer high standards of living, competitive career prospects, and a variety of cultural, social and physical advantages.1 Furthermore, increasing levels of employment in knowledge-based and tech-enabled industries grants top talent the flexibility and power to choose the cities in which they live based on these preferences.

It is clear that the future belongs to those cities that attract, develop and retain the best and most innovative talent. Many countries, including Switzerland and Singapore, have used this

regional strategy effectively to grow, attract and retain their talent, pushing their leading sectors to greater heights.2

This city-centric talent competitiveness holds true for Toronto and the GTA as the region becomes globally recognized as primed for growth, gaining the attention of global tech leaders such as Google and Amazon. Research shows that new technologies are driving employment and economic growth, making the tech sector increasingly important, not only to the GTA, but to Canada as a whole. In 2015, the tech sector accounted for 5.6% of Canada’s total employment and made up 6.1% of all Canadian businesses.3 Overall, the sector was directly responsible for $117 billion or 7.1% of Canada’s real economic output. 4

Despite this, industry employers are struggling to connect with the right talent. A report based on a survey of

1. Davis, D. R., & Dingel, J. I. (2014). The comparative advantage of cities (No. w20602). National Bureau of Economic Research. 2. Lanvin, B., & Evans, P. (2017). The Global Talent Competitiveness Index: Talent and Technology 2017. INSEAD Business School, Adecco Group and Human Capital Leadership Institute. Retrieved from: http://www.gtci2017.com/documents/GTCI_2017_web_r3.pdf. p.12. 3. Lamb, C., & Seddon, M. (2016). The State of Canada’s Tech Sector, 2016. Brookfield Institute. Retrieved from: http://brookfieldinstitute.ca/wp-content/uploads/2016/08/The-State-of-Canadas-Tech-Sector-2016v2.pdf. p. 9. 4. Ibid. 5. Ontario Chamber of Commerce (2017). Talent in Transition: Addressing the Skills Mismatch in Ontario. Ontario Chamber of Commerce. Retrieved from: http://www.occ.ca/wp-content/uploads/2013/05/Talent-in-Transition.pdf p. 4 6. Porter, Michael E. (1998). Clusters and the New Economics of Competition. Harvard Business Review. Print

members of the Ontario Chamber of Commerce indicates that finding properly qualified candidates is their biggest challenge in recruiting staff.5 Companies entering into and growing within this vibrant ecosystem should expect to realize the advantage of tapping into existing pools of readily available, specialized and experienced talent, as such a sourcing advantage effectively lowers the cost of searching for new employees.6

Toronto’s Tech Talent Pool

A pipeline of skilled workers who lack a curated

marketplace for high-quality tech opportunities

Industry employers including ventures and corporations

who are struggling to connect with the right talent

SUPPLY OF TALENT DEMAND FOR TALENT


What we need is a strategy that tackles both the supply and demand sides of talent (Figure 1). Without a skilled workforce, technology employers are unable to power their operations, stalling their growth and potentially causing them to exit the ecosystem. For Toronto to remain globally competitive, tech employers must connect with a highly competitive talent pool made up of job seekers who are trained with the right skills and mindsets for the future of work.

FIGURE 1: The GTA needs a strategy to support both the supply and demand sides of talent

This report dissects the challenges that tech workers and employers currently face in the GTA’s technology ecosystem and presents strategies to increase and enhance the pool of talent available to companies by: (1) broadening the talent pool and attracting job seekers into the tech sector; and (2) building the right mindsets in technically skilled job seekers to ensure they can thrive in high-growth companies.

Operating in the heart of Toronto’s tech sector as a hub for high-growth ventures, corporations and talent, MaRS Discovery District is primed to add value to the region’s talent competitiveness. As the GTA continues to gain global attention, stakeholders must collaborate to create a comprehensive talent strategy for the tech sector to attract the talent needed to power and sustain its growth.


For the Toronto region to win the talent race, job seekers and employers must be alignedThe future success of the GTA’s technology sector will require that employers better understand the trends currently impacting the labour market, including job seeker strategies. As companies’ labour needs become increasingly complex, employers find it more difficult to locate job seekers who have the appropriate blend of technical competencies and required capabilities. This difficulty in finding and recruiting the right talent has caused an increase in the amount of time it takes for firms to source, screen and hire new employees. The World Economic Forum indicates that most strategic and specialist roles across industries, countries and job categories are already perceived as difficult for recruitment, and the situation is expected to worsen significantly over the 2015 to 2020 period.7

Significant misalignment exists between how employers perceive job seekers and how job seekers perceive employers. Tech-industry employers will need to adjust their people strategies, their training and development programs, and other talent initiatives, like recruitment and retention, if they plan to effectively respond to the changing realities of the job-seeker pool and better align themselves to the realities of today’s workforce. 8

Who are the job seekers?For the purposes of this study, job seekers are defined as people who are actively looking for another job and who may or may not be currently working full- or part-time. Of our 589 survey respondents, 53% indicated they are looking for a job. While 9% indicated that they are unemployed (all of whom indicated that they are looking for a job), a full 50% of those

who are currently working indicated they are job seekers (Figure 2).

Our survey showed that 61% of professionals age 22 to 35 indicated they are job seekers, much greater than the 44% of professionals age 45 to 55. This indicates that job seekers tend to skew younger. This difference could be due to a variety of factors including the quality of life and the relative stability that older professionals have attained while in their current roles, their salaries or simply because they have a sense of familiarity with their work. Furthermore, our focus groups revealed that older professionals desire employment stability more so than do younger professionals.

7. World Economic Forum. (2016). The Future of Jobs: Employment Trends. Retrieved from: http://reports.weforum.org/future-of-jobs-2016/employment-trends/ 8. Deloitte. (2017). The Intelligence Revolution: Future-proofing Canada’s workforce. Deloitte LLP. Retrieved from: https://www2.deloitte.com/content/dam/Deloitte/ca/Documents/human-capital/ca-en-hc-IntelligenceRev-POV-Oct25-AODA.pdf. p.28.

All respondents 53%

Occupation

Sales/Marketing 46%

Information technology 57%

Technical 58%

Employment status

Employed 50%

Unemployed 100%

Downsized 100%

Age

22 to 35 61%

36 to 44 51%

45 to 55 44%

Visible minority status

Visible minority 63%

Not a visible minority 47%

Nationality

Born in Canada 51%

Born outside of Canada 56%

N = 589

FIGURE 2Job seekers are more likely to be younger and visible minority workers

Share of survey respondents who indicated they are job seekers


Across occupations, a higher proportion of technical professionals are job seekers compared to marketing and sales personnel. The term “technical professionals” refers to those working in information technology and life sciences, as well as engineers, research-and- development scientists and medical research personnel.

Notably, job seekers are more likely to belong to a visible minority (63% visible minority versus 47% not a visible minority) and are also more likely to have been born outside of Canada (56% born outside of Canada versus 51% born in Canada). The study found no significant differences between the educational attainment of visible minority job seekers and the general job-seeker population.

Research results contained a balance of male and female respondents, with no significant pattern between gender and job-seeking behaviours, despite their under-representation in the tech sector in Canada.9

Job seekers and employers are looking in different placesBefore employers can hire the right candidate, they need to know where to find the most desirable talent, otherwise

the likelihood that the right job seeker will find the right employer is considerably diminished.

But, our research suggests a notable mismatch between the activities currently undertaken by employers to find talent and the activities undertaken by talent to find employment opportunities. In our focus groups with ventures, employers stated that their top talent-sourcing methods include personal networking, referral programs, internship programs and college or university on-campus recruitment focused on the availability of hard skills.

These findings reveal an important distinction when compared against the tools used by job seekers to find work, which include online job boards, corporate websites and referrals from friends (Figure 3). Of the job seekers who use job boards, the most popular services were LinkedIn and Indeed. MaRS’ Community Job Board was identified as the fourth most popular service at 12% (Figure 4).

9. #movethedial. (2017). Where’s the dial now: Benchmark Report 2017. #movethedial. Retrieved from https://www.movethedial.ca/report

Job boards from various sites

69%

49%

45%

30%

30%

26%

14%

35%

Corporate websites’ career pages

Referrals from friends

Head hunters

Professional associations

Informal/Formal networks from training

Government programs’ websites (e.g. Mitacs, OBIO)

Campus placement centres

0% 20% 40% 60% 80%

FIGURE 3: Job seekers are most likely to use online job boards in their job searchWhat resources do you use in your job search? Share of responses from job seekers

Indeed

LinkedIn

Hired

MaRS Community Job Board

CPG Connect

Stack Overflow

GitHub

AngelList

BetaKit

Other

0% 20% 40% 60% 80% 100%

100%

77%

76%

16%

12%

11%

10%

9%

8%

5%

9%

FIGURE 4: Indeed and LinkedIn are the most popular websites used by job seekersWhich online resources do you use in your job search? Share of responses among job seekers who use online reseouces for job search


It appears that while early- and mid-career job seekers are looking for work online, the companies looking to hire them are busy conducting in-person recruitment. However, this is not to say that employers do not have online presences. Instead, our findings show that employers place more emphasis on in-person sourcing tactics that are inherently misaligned with job-seeker behaviours. Employers should rework their sourcing strategies in order to “go where the talent is” and strengthen their online sourcing tools. This is especially important because the majority of job seekers are already employed and are keeping their finger on the pulse of new opportunities by browsing positions online, but are less likely to attend job fairs.

It is important to note that these findings are less true for senior talent, defined as those over the age of 45. Attracting senior-level talent away from their current employment is less common than with early- or mid-career tech professionals because senior-level professionals are less likely to be actively searching for employment opportunities. Because of this, executive talent is less likely to be seeking employment, so searching for executive talent on online job boards will prove less effective. While more research into the dynamics of executive-level talent behaviour is required, these preliminary results suggest that sourcing executive talent cannot be a passive process, rather, it must be a targeted, hands-on recruitment strategy.

I am looking for another job in the same field but with better compensation

34%

15%

14%

9%

7%

6%

4%

10%

I am looking for a promotion

I want to work closer to home

I want to work for a bigger company

I want to change the role I am working in

I do not like my manager

I just completed training in a new area and I am looking for a job in this area

I want to work for a startup0% 10% 20% 30% 40%

FIGURE 5: Better compensation is the top reason job seekers look for another jobWhat is the main reason you are looking for another job? Share of job seekers responses

N = 272


Job seekers are looking for incomeOur research found that workers are ready and willing to take the next step in their career progression if that next step offers better pay and more opportunity for upward mobility. Of the 91% of employed survey respondents, 50% indicated that they are looking for a job. In other words, half of currently employed workers are actively interested in employment opportunities beyond their current jobs and are therefore classified as job seekers.

But what is driving these job seekers? When asked “What is the main reason you are looking for another job?” 34% of respondents indicated they are looking for another job in the same field, but with better compensation and 15% indicated that they are looking for a promotion (Figure 5). These responses reinforce the conclusion that the quality of life and competitive compensation have significant impact on job-seeker behaviours.

To further bolster this finding, we used a Chi-square automatic interaction detector (CHIAD) economic model to identify the strongest drivers between job-seeker identifiers and job-seeking behaviours (see the Appendix for an explanation of the results). Our analysis revealed that income was the most important driver in identifying job seekers among tech professionals. For the purposes of recruitment and retention, ventures and corporations should be aware that total compensation is the primary motivation for job seekers.

At the same time, ventures spoken to in the focus group believe that job-seeking among tech professionals is driven by the opportunity to work on good projects that have the potential to create impact, rather than by the desire for more money or to climb the corporate ladder.

While the quality of work and the potential for impact certainly play roles in job-seeking behaviours, compensation remains the substantive driver. Employers engaged believe they can attract talent with the promise of professional and personal fulfillment through interesting work that creates impact, but job seekersare more often looking for a comfortable income that can offer a good quality of life and the potential for advancement. Together, these variables speak to upward mobility as a key motivator for job seekers and they begin to highlight the disconnect between how tech-sector employers perceive job-seeker motivations compared to the reality of those motivations. If firms can better understand who makes up the job-seeker pool and market themselves to these candidates, they will improve their ability to attract top talent.

Although employers benefit from knowing that they can lure desirable

talent by offering competitive salaries and growth opportunities, they must also recognize that the same pool of job-seeking talent (over half of the job-seeker pool) might also be lured away from them. The risk of losing desirable talent poses the subsequent risk of increased recruitment and training costs to replace the lost talent. With high employment turnover, the risk of losing institutional memory increases, which can then affect the company’s overall performance.

These effects are even more pronounced in scaling startups that have constrained resources and require talent to onboard quickly. As a result, companies must make decisions that will enable them to source top talent from the pool of employed job seekers who are actively seeking other employment, but also to ensure the companies can retain said talent once they have been successfully recruited.

I feel the risk of job loss is high 68%

57%

46%

25%

24%

21%

12%

34%

The pay is lower than in larger corporationsI want to work for a

recognised brandI just do not know much about them

Startups are too small

Startups do not provide opportunities for advancement

I am afraid I will not learn a lot

It does not look good on my resume

0% 20% 40% 60% 80%

FIGURE 6: Risk of job loss and lower pay influences those who want to work at medium or large corporations

What are the top three reasons you are not interested in joining a startup? Share of respondents who wanted to join medium or large corporations

I feel that I will learn a lot

Good startups have a strong financial potential for the future

I want to have an impact on factors important to me

Startups have a flat hierarchical structure

I like the culture

Agility of roles

The unpredictability of work

0% 10% 20% 30% 40% 50%

41%

41%

31%

29%

21%

19%

13%

FIGURE 7: Potential financial gains and learning opportunities influence those who want to work for a startup

What are the top two reasons you would want to work for a startup? Share of respndents who want to join a startup

N = 244

N = 70


Job seekers don’t know much about startups—but do believe they’re riskyWhen job seekers were asked about the top factors that limited their desire to work for startup companies, they indicated their beliefs that the risk of job loss is high and that startups offer lower compensation (Figure 6). However, 34% of respondents in this same group admitted to a general lack of knowledge about startups.

These responses may allude to a considerable negative bias against the term “startup” and also point toward a basic lack of knowledge about the startup ecosystem. These responses also present opportunities to educate job seekers about startups and to improve general perceptions around startup companies. Similarly, there is an opportunity for less mature startups to leverage trusted ecosystem brands to help lend credibility and trust to their own brands. If successful, such education and branding exercises could increase the pool of applicants that are willing to join startups in the future.

When job seekers who are interested in working for startups were asked about the factors that attract them to these companies, their top reasons included: feeling that they would learn a lot from the experience; the belief that good startups have strong financial potential for the future; and the belief that startups offer the opportunity for purpose-driven work (Figure 7). Given that financial incentives have been found to be a motivator for job seekers, the perception of strong financial potential can be channeled to renegotiate the narratives of startup employers with top talent in the ecosystem by communicating the advantages that ventures can offer.


Also, in contrast with talent perceptions, the corporate hiring managers in our focus groups expressed an interest in hiring people who had worked in startups due to the entrepreneurial mindsets that such experiences would have helped the employees to develop.

The conglomeration of this data illustrates a significant cost of lost opportunity for the startup ecosystem: pervasive misconceptions coupled with a lack of knowledge and limited employer-brand recognition act as strong deterrents for job seekers who are considering startup employment opportunities. If such deterrents persist, the pool of talent available to employers in the small- to medium-size enterprise and startup spaces will continue to be constrained by misconceptions, thereby hindering their ability to attract top talent to power their growth as they scale.

The ventures in our study assumed that the majority of technical professionals want to work for the “Big 5” (Google, Amazon, Facebook, Twitter and Snapchat) and that startups tend to lose talent to these corporate giants.

In contrast, when asked what types of organizations they want to join, the majority of job seekers expressed an interest in joining scaling small-to medium-size companies. The number of job seekers looking for work at either startups or large corporations is relatively balanced: 22% indicated that they want to join a startup (0 to 50 employees), 52% are interested in joining a scaling small- to medium-size company (100 to 1,000 employees) and 24% want to join a large corporation (over 1,000 employees).

The current recruitment and retention challenges faced by the tech ecosystem in the GTA lead to increased risks for the region. Startup companies may leave in search of larger markets where talent is easier to source. For startups and scaling ventures to remain competitive and to grow within the GTA’s tech sector the future, the region will need to focus now on being intentional with growth strategies and practices that will increase the available talent pool.


Creating mindsets that matter to both employers and job seekers is key to cracking the employment codeToday, employers and job seekers alike can see that the accelerating pace of technology-driven change has altered the Canadian labour market. Job requirements are complex, as are the skills required to compete in tech fields. Job seekers need to possess not only basic technical skills, but also adaptability and mindsets for growth that empower them to ride the wave of change by remaining skillful and relevant employees in the sector. These mindsets for growth—which include assets such as social awareness, judgment, and agility— are hailed as essential for the future of work and the new roles that increasingly become cross-functional and multi-disciplinary moving forward.10 (See sidebar: What are the mindsets for growth? on page 17)

But our study reveals that a mismatch exists between the technical skills emphasized in job roles and the broader mindsets that determine final hiring decisions. Ultimately, there are discrepancies between what employers are asking for on their posting and what job seekers are bringing to the table.

To crack the code of the misalignment between employee recruitment and job seekers, the tech ecosystem stakeholders need to reduce the time it takes to hire appropriate employees and the costs of sourcing the talent required for ventures to scale. In this vein, job seekers must be able to grow and pivot with their employers as companies continue to adapt with, and shape, the future of work.

Employers are looking for hybrid skillsHybrid roles refers to jobs that illustrate the convergence of hard skills and innovative mindsets, and employers seek cross-functional workers that possess these hybrid skills. When recruiting for positions, hiring managers state that advertising a job posting broadly tends to result in their receiving on average 200 to 300 applicants who have the required technical skills. However, technical skills are only a basic requirement for talent to be considered for employment.

10. Deloitte. (2017). The Intelligence Revolution: Future-proofing Canada’s workforce. Deloitte LLP. Retrieved from: https://www2.deloitte.com/content/dam/Deloitte/ca/Documents/human-capital/ca-en-hc-IntelligenceRev-POV-Oct25-AODA.pdf p.28


Beyond basic technical proficiencies, employers expect talent to possess other attributes that complement or enhance these discipline-specific or technical skills. Managers in the tech sector agree that what they really need are hybrid workers who possess a blend of technical skills and mindsets for growth.

For example, tech companies may seek hard technical skills like computer programming coupled with innovative mindsets like knowledge of competing sectors and ability to influence. This report pushes the understanding of hybrid skills further by introducing the dimension of mindsets and life skills. Life skills refer to basic proficiencies expected of all employees including punctuality, interpersonal and organizational skills. Mindsets on the other hand refers to the worker’s ability to negotiate between their amassed hard, soft and life skills to respond to unexpected challenges, develop novel approaches to complex problems, and effectively manage people and activities to promote advancement. Technical skills may secure an interview, but the appropriate mindsets will ensure candidates are hired.

The emphasis on technical acumen in employment conversations has limited job seekers’ ability to understand, communicate and demonstrate the mindsets required for success in the rapidly evolving tech sector. In part, this has created a challenge for the tech employers in this study and across Ontario to find ready talent. The recruitment and training of job-ready talent is an area ripe for disruption, as 34% of employers in Canada have difficulty filling positions due to the perceived lack of suitable talent.11 Additionally, the average time-to-hire rate has risen dramatically in Canada, from just over 12 days in 2010 to over 20 days in 2017.12 According

to a ManpowerGroup survey, 61% of Canadian employers are recruiting outside of the talent pool, 40% are exploring alternative sourcing strategies and 23% are outsourcing work.13 In order to reduce the time-to-hire, and, further, in order to ensure success for newly hired employees, accelerating the development of mindsets training before employment and while on-the-job is one opportunity to meet the needs of both employers and employees.

Admittedly, mindsets necessary for success in the tech sector are complex and continuously evolving. In order for talent to effectively upskill and evolve with the changing labour market demands of the sector, employers must improve their ability to communicate their needs to the available pool of talent. This is no small undertaking — time and resources need to be spent to help talent understand employer needs. This will allow talent to seek out experiences that promote valuable personal and professional growth opportunities, promote the right mindsets, and improve the quality of the talent pool going forward. More research is needed to articulate the specific needs of tech-sector employers, develop a shared language to communicate these needs widely and develop an abundance of opportunities and experiences that can afford talent the opportunities they need if they are to be the employees that employers want.

While different methods can be used to obtain and foster the mindsets for growth, it is important to quicken the process of development for job seekers. There is a belief that these mindsets for growth can be developed intentionally while in the workplace through experiential work-integrated learning rather than developed solely in formal educational settings. As a result, employers express a desire

to hire candidates who have more years of work experience, as these workers are more likely to have acquired the necessary hybrid skills through their previous jobs.

Of the survey respondents who were asked to indicate how they developed the skills for their current job, 47% percent indicated that they developed their skills “on the job.” We suggest that while employers recruit talent with an emphasis on training and technical skills, they are also looking to hire people for the mindsets they have developed through previous work experiences.

11. ManpowerGroup. (2016). 2016-2017 Canada Talent Shortage Survey. Retrieved from: http://manpowergroup.ca/campaigns/talent-shortage/assets/pdf/2016-Talent-Shortage-Canada-Whitepaper.pdf 12. Chamberlain, A. (2015). Why is hiring taking longer? New insights from Glassdoor Data. Glassdoor. Retrieved from https://www.glassdoor.com/research/app/uploads/sites/2/2015/06/GD_Report_3.pdf. p. 6; Chamberlain, A. (2017). How long does it take to hire? Interview Duration in 25 Countries. Glassdoor. Retrieved from https://www.glassdoor.com/research/time-to-hire-in-25-countries/ 13. ManpowerGroup. (2016). 2016-2017 Canada Talent Shortage Survey. Retrieved from: http://manpowergroup.ca/campaigns/talent-shortage/assets/pdf/2016-Talent-Shortage-Canada-Whitepaper.pdf

Mindsets for growth

Hard Skills Action

Life Skills OpportunitySoft Skills Growth


What are the mindsets for growth?Many job seekers focus their efforts on proving that they have the skills necessary for employment. More often than not, they emphasize hard skills such as coding or programming skills, database management and analytical skills like data mining, economic modelling and forecasting, etc. However, industry employers expressed that these hard skills are only enough to secure an interview for job seekers. What separates successful candidates from the rest are demonstrated “mindsets for growth.”

A mindset for growth is different from the typical soft skills needed for the vast majority of jobs, such as communication skills and emotional intelligence, or life skills such as punctuality and work ethic (although these, of course, are also very important).

Figure A illustrates how mindsets for growth work to translate hard skills, soft skills, and life skills into new growth opportunities and action. This translation may occur through effective people management skills, emotional intelligence, or resource management and delegation, etc. Moreover, this figure demonstrates that mindsets for growth are maintained through a continual feedback loop. Workers’ skillsets are dynamic and respond to the ambiguous environments in which they work and live in order to

FIGURE A: Mindsets for growth are maintained through a continual feedback loop

generate new activities and opportunities to promote personal or organizational growth. These new activities, opportunities, and growths generate new experiences that add to, or enhance, existing skillsets. Mindsets for growth are the continuous and willful interaction of skills and experiences that perpetually bolster the range and abilities of workers to respond to change and generate novel solutions.

Importantly, a mindset for growth does not assume a specific vision or outcome, but refers to the ability to operate in ambiguity, and the potential to generate growth opportunities in a range of settings. Ultimately, this mindset is a tendency towards a vision of possibility that can then be applied to any given sector or problem to generate opportunities, actions, and growth. Admittedly, mindsets for growth require a prerequisite understanding of a variety of variables (external and internal) that may converge upon any given situation or tasks – those who have this mindset regularly assess the known knowns, known unknowns, and unknown unknowns that weigh upon success.

Specific to high-growth companies in the tech sector, mindsets for growth enable workers to respond to the constantly changing forces in this new economy. A mindset for growth includes, but is not limited to:

• The ability to work cross-functionally across teams;

• The ability to work with risk in complex environments;

• An orientation toward lifelong learning and the curiosity to take on different roles;

• A demonstrated entrepreneurial spirit to tackle challenges with novel approaches;

• A high tolerance for navigating in ambiguity and uncertainty; and

• An intellectual humility, or the ability to evaluate critically one’s own ideas and beliefs as well as those of others.

These mindsets are difficult to teach in a traditional classroom setting since such perspectives are not simply attained. Rather, it is sought out and maintained through personal and professional development and lifelong learning. A mindset for growth is like a bias to action but in this regard, not simply a desire to act, rather to act in the service of future growth at either the organizational or personal level. This requires intentionally structured work-integrated learning environments. Workplaces must provide project-based opportunities to exercise these mindsets coupled with reflection and mentorship activities to integrate these learning experiences into practice for young professionals.

Employers are recruiting with an emphasis on technical skills, but are hiring talent based on the mindsets required to thrive in their organizations.


Cultural fit is preventing job seekers from under-represented groups from accessing opportunitiesIn our interviews, ventures noted that finding technical talent who also fit the company culture is challenging. Some employers expressed the belief that “problems” could arise when employees from different cultures and nationalities worked closely together, and they had additional concerns regarding the ability of potential hires to mesh with the workplace culture. Companies felt that this cultural fit was critical, and some managers stated that fit was occasionally more important than technical skills when determining which applicant to hire. Additionally, employers’ preferences to source talent through college or university campus recruitment activities and internships reflect recruitment’s innate emphasis on in-person interactions to assess fit.

The emphasis placed on cultural fit creates barriers to the inclusion of groups who are not currently represented in workplaces, like visible minority groups who are under-represented in tech-sector companies.14

Hiring for cultural fit has been shown to emphasize unconscious bias in hiring practices, diminishing the opportunity for visible minorities to join and integrate into workplaces.15

Given this dynamic, it is not surprising that job seekers are more likely to be visible minorities who may be seeking more inclusive workplace cultures with hiring practices which prevent biased hiring.

Our findings also suggest that job seekers from under-represented groups who have the required technical skills and education face unwarranted limitations concerning cultural fit. Our survey showed that visible minorities in this study have similar rates of educational attainment at both the undergraduate and graduate level when compared to non-visible minorities, yet visible minority workers are still more likely to be job seekers.

This is concerning for the tech sector in the Toronto region.

The current talent supply is diverse. If ventures are not able to source, attract and retain employees with a variety of backgrounds, experiences and skills, then the time taken to hire will continue to increase. Job seekers from under-represented groups are primed to add to economic productivity: they have the necessary education and experience, and are actively looking for opportunities for growth and advancement. They are raising their hands and wanting to contribute at a higher level.

There is a strong opportunity for MaRS to leverage its brand recognition among these populations of the untapped local talent pool, especially given that many of the visible minorities surveyed were aware of MaRS. Furthermore, MaRS can help the Toronto region to leverage its brand as a diverse and vibrant city, and to welcome more highly skilled talent into the ecosystem.

Hiring for mindsets should replace hiring for cultural fitRather than focusing on cultural fit, ventures and corporations alike should hire for versatile mindsets—only then can they begin to gain the benefits of hiring a broad range of capable job seekers. To achieve this shift towards hiring for mindsets, job seekers must be offered the opportunity to develop and demonstrate the skills they have gained through training and work experiences using a shared language that employers will recognize and understand.

Skills and mindsets can no longer be measured by a credential alone; rather, they must be measured by the experiences workers have gained and the types of training they have received.16 An emphasis on lifelong learning, micro-training and up-skilling for mindsets requires the ecosystem to shift its hiring practices.

14. McConnell, J. (2017, June 19). New #HackDiversity documentary wants the tech sector to start taking inclusivity seriously. Financial Post. Retrieved from http://business.financialpost.com/technology/new-hackdiversity-documentary-wants-the-tech-sector-to-start-taking-inclusivity-seriously 15. Schmidt, L. (2017). The End Of Culture Fit. Forbes. Retrieved from https://www.forbes.com/sites/larsschmidt/2017/03/21/the-end-of-culture-fit 16. We recognize that in order to make this an accessible option for a wide range of job seekers, it is important to ensure such experiences and training do not reinforce exclusive hiring practices.


A talent strategy for the GTA’s tech sector

The recommendations below aim to increase and enhance the pool of talent available to companies in the technology sector in two ways:

• By broadening the talent pool and attracting job seekers into the tech sector

• By building the right mindsets in technically-skilled job seekers to increase their attractiveness to tech-sector employers and to ensure they can thrive in high-growth companies

There is an opportunity for ecosystem stakeholders to collaborate on these five recommendations to enhance the ability of tech-sector employers to connect to job seekers in the GTA in a comprehensive way.

1. Moving beyond technical skills: Job seekers need to accelerate the development of key mindsets for growth to complement technical acumen

As employers build teams for the future of work, they are demanding candidates who have both the technical skills and the mindsets for work required in the rapidly evolving technology sector. This report’s findings suggest that the necessary technical skills are largely present in the tech ecosystem, as most job seekers are currently employed. Employers also report seeing large responses to job postings for technical roles. However, upon deeper review, our interviews revealed that the mindsets needed for success in the innovation economy are less likely to be present in candidates and are also harder to find. These mindsets allow talent to work collaboratively, think critically to solve new problems,

remain agile in their approach to challenges, take risks and pivot their approaches as needed, remain curious by questioning others, and step out of their comfort zones.

Job seekers cite formal education as their method for building their technical acumen, yet research shows that while mindsets can be introduced through formal education, they are best developed and mastered through work experience.17

In an ecosystem where most job seekers are young professionals with few years of work experience, this report suggests that an intervention is needed to accelerate the development of key mindsets among the active job-seeker pool, leveraging experiential work-integrated learning (WIL) opportunities.

17. Crebert, G., Bates, M., Bell, B., Patrick, C. J., & Cragnolini, V. (2004). Developing generic skills at university, during work placement and in employment: graduates’ perceptions. Higher Education Research & Development, 23(2), 147-165.


Recommendations:

• Post-secondary institutions must ensure that experiential WIL opportunities are accessible to all students so that graduates obtain economically relevant skills and mindsets. These programs and opportunities must include reflection and integration activities to secure students’ abilities to communicate how their work experiences have helped them develop the mindsets that employers seek. To accomplish this, industry partners must be involved in determining the scope and structure of these WIL opportunities.

• Government must incentivize partnerships between post-secondary institutions and industry to ensure that curricula meet the needs of scaling companies at the forefront of innovation in fields such as artificial intelligence, automation and cybersecurity. To do this, innovative partnerships that bring together industry and college and university partners to co-design WIL certificate programs for the workforce must be established. These partnerships must also be accessible to small- and medium-size enterprises for assurance that the Toronto region’s SME ecosystem sustains its growth and remains globally competitive.

• Industry employers must invest in capacity-building supports for their human resource teams to source candidates and to identify the candidates’ mindsets effectively in the hiring process. Furthermore, it is essential for employers to provide capacity-building programming in their organizations to current staff to expand their capabilities and continue to develop the mindsets necessary for growth.

2. Competitive compensation retains top talent: Organizations must be intentional about competitive compensation packages and opportunities for employee growth and development

Tech-sector employers must recognize that top talent is drawn by high-skilled jobs that promise competitive wages, as well as opportunities for growth and advancement. Our research has shown that compensation is the strongest driver for job seekers. While we understand that salaries are dependent on the type of role and the experience required, employers must also keep compensation and cost-of-living expenses in mind when looking to retain top talent in the GTA.

Active job seekers in this study were more likely to have fewer than 10 years of work experience and they valued access to learning and development through the opportunity to work on interesting projects and clear paths to advancement.

Recommendations:

• Employers must review competitive market rates for their job roles and directly address any compensation concerns, either by paying more or demonstrating pathways for upward mobility and future earnings potential.

3. Intentionally integrating diversity into the talent pool: Develop a sector-wide strategy to attract and retain a diverse workforce of top talent

Toronto region’s tech-sector companies need both sector-wide and employer-specific supports to attract, actively integrate and successfully retain a diverse pool of talent. Job seekers interested in the GTA’s tech sector are more likely to be visible minorities and immigrants to Canada. Because these groups are currently under-represented in the tech-sector workforce, onboarding

this talent must be coupled with inclusion strategies to integrate these candidates into a workplace culture effectively. Additionally, structural supports are required for workplaces to acknowledge the inherent biases present in traditional sourcing and recruitment systems.

Recommendations:

• A sector-wide diversity-and-inclusion working group must be created to co-design a comprehensive approach to attracting, integrating and retaining a diverse pool of talent. This strategy should include diversity and inclusion best practices, collecting agreed-upon sector-wide metrics, and an implementation guide that can be adopted by organizations in the Toronto region tech ecosystem.

• Workplaces must have structural supports to implement diversity and inclusion strategies. Organizations’ inclusion councils must be empowered with resources to employ initiatives such as unconscious-bias training to create the capacity for building an inclusive culture and integrating previously under-represented groups into the workplace. These councils should be connected to the sector-wide working group to ensure that tech employers across the ecosystem are aligned in this effort.

• Employers must transition from hiring for cultural fit to hiring for the mindsets necessary to grow and scale in the tech sector. Supporting employers to better identify those mindsets through research and sharing of best practices would help begin this transition, a task which can be spearheaded by MaRS.


• Job seekers must have access to capacity-building supports to ensure that they enter workplaces with the mindsets needed to encourage a culture of diversity and inclusion. MaRS and post-secondary institutions must make this training accessible to the pool of talent as part of its WIL training programs.

4. Sourcing talent: Build a diverse talent pipeline for GTA tech-sector employers

Job seekers primarily use online platforms to find opportunities and, as such, employers must place a larger emphasis on online recruitment strategies.

While employers are currently expending resources on active recruitment activities such as job fairs and college or university campus recruitment, already-employed job seekers are mainly seeking opportunities online. Active job seekers are also more likely to be

employed, further reducing the likelihood that these candidates will attend job fairs and in-person meetups. Additionally, while referral programs are popular among employers and job seekers, these programs risk promoting opportunities only to closed networks that may not include under-represented groups.

To further enhance online sourcing, employers and talent can both benefit from access to a common marketplace for tech-sector jobs that curate opportunities for busy job seekers and funnels top talent to opportunities in this growing ecosystem (Figure 8). MaRS can leverage its awareness among job seekers to lend credibility to this marketplace, creating a one-stop shop for the best jobs in the Toronto region tech ecosystem. This marketplace would serve to meet talent where they search and would also showcase lesser-known ventures to a diverse pipeline of job seekers.

EXHIBIT 8: A common marketplace of top talent will decrease the time to hire

Train the near-skilledAttract Top Talent into

the Tech Sector

Source from a Verified PoolInterviews / Screening

Hire Top Talent

Increase Talent Pool for Hire in Tech

Decrease Time Required to Hire

LABOUR MARKET

COMMON MARKETPLACE

TECH SECTOR

Top Tech Jobs in Toronto’s Ecosystem

Recommendations:

• Tech-sector companies must actively engage talent virtually, leveraging endorsed channels to funnel top talent to their employer brands. For instance, employers can leverage a MaRS-endorsed marketplace by posting roles on this platform and sourcing from these candidates for interviews.

• Employment service agencies require access to capacity-building tools in order to understand the skills and mindsets required for work in high-growth tech companies. With these tools, the agencies will be better positioned to support talent who are seeking opportunities in the tech sector. Additionally, these agencies can promote opportunities to talent unaware of the sector, broadening talent pipelines into the tech companies.


• MaRS must work with industry partners to set up a common online marketplace for curating tech-sector opportunities for job seekers. This will also allow MaRS to lend its brand to ventures with less brand recognition, helping them to attract top talent.

• MaRS should explore developing demand-side services to enhance ventures’ abilities to attract talent effectively through their brand marketing, role descriptions and hiring practices.

5. Crafting the Toronto region’s tech story: Create a sector-wide marketing campaign for the GTA’s booming tech ecosystem to attract top talent

The sector needs a multi-pronged approach that educates job seekers on the realities of the labour market and the advantages of working for scaling ventures. There are misperceptions in the Toronto region ecosystem as job seekers navigate a rapidly changing labour market comprised of startups, small- to medium-size enterprises (SMEs) and larger corporations. Over half of job seekers want to work for SMEs, with the remainder opting for startups or larger corporations. Furthermore,

a third of respondents were unaware of what opportunities existed within the startup ecosystem.

The startup ventures are scaling into SMEs and can offer high-quality employment opportunities. However, a lack of awareness of and/or misconceptions about startup environments coupled with a lack of employer-brand recognition is a strong deterrent for job seekers. Given its current partnering with industry employers, MaRS is well positioned to lead a sector-wide campaign to show job seekers the advantages of working for scaling startup ventures. This campaign must target the job-seeker profile identified through our research, including already-employed talent, visible minorities and immigrants to Canada. This will help top talent to become more knowledgeable about ventures, increasing the likelihood that they will seek employment in the tech sector and also increasing the sector’s pool of engaged talent.

Recommendations:

• MaRS must leverage its brand credibility among job seekers to lead a campaign showcasing the advantages of working for scaling startup ventures.

• Ventures must recognize the profile that makes up the pool of active job seekers and craft their own branding and marketing practices with this group in mind.

• The tech-sector online marketplace should be featured in this campaign to build awareness of it among top talent and to direct them to the platform to increase the pool of talent available for sourcing and recruiting.


Conclusion

MaRS recognizes that for Canada to remain globally competitive, the tech industry in the GTA must be able to connect with a highly competitive talent pool comprised of workers who are trained with the skills and mindsets for growth needed for the future of work. This report illustrates the complex dynamics of the Toronto region’s tech sector labour market which must be considered when tackling this opportunity. It is important to understand and build comprehensive talent strategies around the profiles and motivations of the job seekers in this ecosystem. These strategies must address the sector-wide issues of attracting, sourcing and retaining diverse talent, while also building and growing a pipeline of talent for future opportunities.

To do this, ecosystem stakeholders must work together with the goal of enhancing the ability of tech-sector employers to connect with job seekers in Toronto and the GTA. MaRS is committed to working with all stakeholders to move the recommendations listed in this report forward. This collective effort will encourage more talent to consider opportunities in high-growth technology companies, ensure more skilled professionals have the mindsets required for success in these environments and steward a bold narrative for the Toronto region as a lucrative destination for top talent globally.


Appendix: Methodology

To better understand the interplay between employers and job seekers in the Greater Toronto Area (GTA), this study was divided into a qualitative phase that focused specifically on understanding the talent demands of employers in the tech sector and a quantitative phase that collected data around the current trends in the talent supply pool, including job seekers’ demographics, mindsets and behaviours.

Qualitative data was collected from six separate focus groups that asked employers for insights into their talent needs and the most important challenges they are currently facing in the recruitment and hiring of appropriate personnel. These discussions were held at MaRS with companies presently operating within the MaRS ecosystem and included venture and corporate personnel

responsible for hiring talent for their respective organizations. Four of the focus groups engaged with venture CEOs and human resource (HR) managers and the remaining two groups were comprised of corporate HR managers and senior leaders.

Quantitative research was conducted with professionals between the ages of 23 and 55 who were invited to complete a short online survey that took (approximately 10 minutes to complete). Among the representative sample of 589 respondents, 316 were technical professionals and 273 were marketing and sales professionals, all located in the GTA. Technical professionals included those working in information technology, life sciences and medical research, as well as engineers and research-and-development scientists.

Generally, a quarter of respondents had attained a college degree (24%), nearly half had achieved an undergraduate degree (48%) and about one-fifth had earned a graduate degree (19%).

CHAID analysis explanationThe data collected under this phase was further subjected to a Chi-squared automatic interaction detection (CHAID) analysis in order to identify the variables that had the strongest correlations to job-seeking behaviours. CHAID performs segmentation modelling that is useful in any situation in which the overall goal is to divide a population into segments that differ with respect to a designated criterion (dependent variable).


CHAID begins by dividing a population into two or more distinct groups based on categories of the “best” predictor of a dependent variable. It then splits each of these groups into smaller subgroups based on other predictor variables. This splitting process continues until no more statistically significant predictors can be found (or until some other stopping rule is met). Automatic interaction detection displays segmentation results as an easy-to-understand tree diagram whose branches (nodes) correspond to mutually exclusive subgroups. 18. Kass, G. V. (1980). An exploratory technique for

investigating large quantities of categorical data. Applied statistics, 29(2), 119-127. doi: 10.2307/2986296 19. See Breiman, L., Friedman, J., Stone, C. J., & Olshen, R. A. (1984). Classification and regression trees. CRC press.

Another feature of CHAID that occurs concurrently with the splitting algorithm is the merging of categories within a predictor variable that are not significantly different with respect to the dependent variable. This merging procedure, combined with the splitting algorithm, ensures that cases in the same segment are homogeneous with respect to the dependent variable.

While both CHAID and traditional cluster analysis divide a population into subgroups, only CHAID uses a dependent variable as a criterion for forming the subgroups.

The cluster method, when applied to a categorical dependent variable, is often referred to as the CHAID technique.18 When the cluster method is applied to continuous dependent variables, it is similar to the classification and regression trees technique.19

Income less than $61K67.8%32.2%

143

Not a visible minority41.0%59.0%

266

Age 22-4447.3%52.7%

186

Age 45-5526.2%73.8%

80

Visible minority60.0%40.0%

180

Occupations: Sales, Marketing, Life Sciences

58.4%41.6%

101

Occupations: IT related, R&D, Engineering

90.5%9.5%

42

Age 22-35100.0%

0.0%20

Age 36-5581.8%18.2%

22

Country of birth: Canada, West Europe,

Middle East, USA50.0%50.0%

79

Country of birth: South Asia,

East Europe, China, Caribbean, Other

77.4%22.6%

31

Income $61K or more48.7%51.3%

446

Dependent Variable = Job Seekers (Y/N)53.3%46.7%

589

FIGURE B:Job Seeker BreakdownYesNoTotal


AcknowledgementsMaRS Discovery District would like to thank the Ontario Ministry of Advanced Education and Skills Development for their generous funding for this project.

The following individuals graciously sat on the Industry Advisory Board for this report and contributed to its insights:• Chris Brown, LinkedIn

• Robb Gilbert, BlueDot Inc.

• Thomas Heermann, Autodesk

• Heather Holmes, Shopify

• Eric Kennedy, LinkedIn

• Ryan L’Abbe, GreenMantra Technologies

• Marin Litoiu, York University

• David McDonald, Manulife Financial

• Gladys Okine, First Work

• Jennifer Posthumus, City of Toronto

The authors would also like to thank the following MaRS Discovery District employees who contributed to the report: Victoria Abboud, Kate Boyle, Daneal Charney, Kara Collins, Joe Greenwood, Krista Jones, Ivana Lochhead, Dominique Riviere, Amie Sergas, Usha Srinivasan, Jovana Stranatic, Salim Teja, Kevin Twomey and Jon Worren.

Report authors:

Lekan Olawoye, Lead Executive, Studio [Y]

Melissa Pogue, Manager, Program Research and Operations, Studio [Y]

Danton Sück, Program Associate, Studio [Y]

Gina Uppal, Senior Program Associate, Partnerships, Studio [Y]

Studio [Y] is a talent development platform that equips tech talent with the leadership and innovation skills necessary to effect change at a systems level over the course of their careers. Our mandate is to create a pipeline of high-performing entrepreneurs, intrapreneurs, leaders, and innovators by providing them with the critical skills and mindsets to contribute to the tech ecosystem in the Greater Toronto Area. To achieve these goals, we work with MaRS industry experts in key growth sectors, as well as with other relevant stakeholders in government, the private and non-profit sectors, and education, specifically in the post-secondary sector.

To stay up to date with the latest news from Studio [Y], please register for our e-newsletter at

marsdd.com/newsletter-register.

https://marsdd.com/newsletter-register/

JANUARY 2018 Talent Fuels Tech...strategies that might better connect the supply of talent...

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