A tight labor market in the U.S. has employers looking for creative solutions to head count challenges — and some are looking northward for help.

Envoy Global's recent Immigration Trends Report surveyed about 400 HR leaders and hiring managers and found employers are increasingly targeting Canada as a future talent hub. Canada's growing cachet is due in part to its population of English-speaking foreign nationals and comparatively employer-friendly immigration policies; in response, some employers are opening satellite offices or building talent hubs over the border.

As the U.S. labor market tightens and government scrutiny increases, hiring foreign talent in Canada is seen as an increasingly attractive option for companies, Dick Burke, CEO of Envoy, told HR Dive. But the interest in Canadian talent is more than just one-off curiosity in employer-friendly policy; it represents a broader shift in how and where employers are sourcing top talent worldwide.

The visa squeeze

For American companies, delays and difficulties in acquiring visas for foreign workers has driven some to establish HQs elsewhere to take advantage of the talent climate. According to a letter sent to U.S. Citizenship and Immigration Services leadership by concerned senators in May, processing delays for some work permits have "led to disruptions in American businesses, many of which depend on employees who need work authorization to carry out their functions." Denial rates for H-1B visas are up, and employers are having trouble getting approvals for existing H-1B visa holders. And uncertainty about the future of hiring foreign nationals continues as the Department of Homeland Security considers even more changes to the process.

Newer immigration policies in Canada are perceived as more employer-friendly, Burke said; 65% of respondents to the Envoy survey believe Canada has more favorable immigration policies compared to the U.S. 

Canada plans to add more than 300,000 new permanent residents in 2021, and its total immigration goal from 2018 to 2021 was set at more than 1 million. Many will come in through the country's Express Entry system, an application system for skilled workers that asks potential immigrants about their spoken languages, education credentials and job experience. 

The results are striking. In 2017, Toronto added more tech jobs than Seattle; Washington, D.C.; and the Bay Area of San Francisco combined, according to stats cited by Envoy's immigration report. 

Trending north

"We anticipate the trend we see of companies finding alternative ways of 'getting work done' will continue to accelerate," Asumi Ishibashi, talent management, North America practice lead at Willis Towers Watson, told HR Dive in an email. While cost might be a driver, it is increasingly about supply and demand of critical skills and access to the right talent ecosystem, she added.

"Many employers have discovered that the Canadian labor market offers certain advantages over other foreign markets for attracting and retaining talent," Michael Durham, partner at Barnes & Thornburg, told HR Dive via email. Due in part to additional visa classifications available to Canadian citizens, along with certain visa processing courtesies afforded to Canadian citizens, employers have found that employment visas are sometimes easier and faster to obtain for Canadian employees than those from other nations, he noted.  As the domestic labor pool continues to shrink, he added, the trend for employers to seek Canadian candidates is expected to grow.

Thirty-five percent of employers responding to Envoy's report said they're hiring foreign national talent in Canada. Another 38% are considering an expansion to Canada, with 21% revealing they already have at least one office there. "Because Canada recently announced a plan to bring 350,000 foreign nationals into the country annually between now and 2021," Burke said, "we expect to see companies continue to take advantage of this opportunity."

Tech opens the door

The opportunity to collaborate with colleagues closer to the U.S. and within similar time zones puts Canadian remote workers in a better position than those, perhaps, across the pond. For some organizations, Canadian workers may even be at a closer distance to HQ than those on the other side of the U.S. 

Ishibashi believes forward-looking organizations are taking advantage of this opportunity by paying attention to the potential impact of technology and other mega-trends on their workforce. "Companies are moving past annual budgeting process to taking a more holistic view on workforce planning, and considering implications of technology and evolving business models," she said. According to Ishibashi, they're asking the key questions: What jobs or tasks might be automated, augmented or created? How can employers come up with new ways of sourcing talent to get work done? And how do employers ensure they engage their people and create an environment of productivity?

Durham said employers seeking to take advantage of the Canadian labor market should secure qualified U.S. immigration legal counsel to assist them in preparing and processing U.S. employment visas for their Canadian employees.