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Businesses Canada

Amazon Plans Vancouver Expansion Where Talent Is Cheap (bloomberg.com) 98

Posted by msmash from the closer-look dept.
Amazon expects to nearly triple its workforce in Vancouver, where software engineers are cheap, smart and plentiful. From a report: The online retail giant plans to occupy a bunker-like former Canada Post mailing center that's being redeveloped into a new 1.1 million square-foot office to house 8,000 jobs by 2023, Jesse Dougherty, a vice president and Vancouver site lead at Amazon, said by phone. Currently, the company has 2,700 full-time employees at its city hub. It also plans to add 500 jobs in Toronto, according to a statement released Monday. A weak loonie, lower wages and a steady flow of graduates make Canada an attractive place to expand for tech companies whose largest expense is labor. The average wage of a software developer in Vancouver last year was $92,726, compared to $141,785 in San Francisco or $128,067 in Amazon's hometown of Seattle, according to a July report by real estate firm CBRE Group Inc. Once rental costs are folded in, the cost of running a 500-employee operation in the Canadian city is half that of a similar-sized operation in the Bay Area, it found.
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Amazon Plans Vancouver Expansion Where Talent Is Cheap More

Amazon Plans Vancouver Expansion Where Talent Is Cheap

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  • Am I missing anything that is supposed to be nefarious there? The tone of the article seems to indicate so.

    • It is nefarious if you live along the west coast of the United States, and you are unwilling or unable to move to Canada.

      However it is the basic trend. Startups like to West Coast, as it is easy to find talent that you can hire to work for you, so you can get your business off the grown and growing, even if property and salaries are very high, to get off the ground, a major factor is getting people who know what they are doing into your company quickly, and get them making products.
      However after a company

      • And...with the concept of working remotely taking on a MUCH more viable role, even looking long term....locaton of the talent is going to become less and less of a thing.

        They could easily start hiring from the Canadian talent pool and never have much more than a small actual physical footprint there (if necessary at all).

        Hell, you're seeing folks from the high value areas move from SF and NYC to cheaper areas to live and keeping their tech jobs.

        Of course at some point, the employers are going to start ba

        • Re: (Score:2)

          by mark-t ( 151149 )
          Many companies already do this... a person works for a salary that is commensurate with their position and experience, but they receive a certain amount over that, typically called a cost of living bonus, which corresponds to the city in which they actually work from. In one city, for example, the COL bonus might be 20%, while in another it can be half that or even less. The COL bonus is a fixed percentage of income calculated based on location, and is independent of the actual position held, and the ba

        • Re: (Score:2)

          by larwe ( 858929 )
          Facebook has already announced that they will give you a cost of living haircut if you relocate to a lower cost area. https://www.marketwatch.com/st... [marketwatch.com]

  • Another reason Canada is so attractive (Score:3)

    by dskoll ( 99328 ) on Monday September 28, 2020 @01:21PM (#60551144) Homepage

    Medical insurance premiums are a fraction of what they are in the US, because most things are covered by the government in Canada. So it's much cheaper for companies to offer benefit plans in Canada than the US.

    • Except most US companies pass on those premiums to the employees.

      • They do, but it is still very expensive for the companies. As well if that 90k Job in Canada, you bring home bigger paychecks (even with higher taxes) because of the inefficiencies of the American Health Insurance model.

      • Re: (Score:2)

        by dskoll ( 99328 )

        They usually pass on a portion of the premiums, not the whole thing, especially if they're trying to attract talented developers.

      • Re: (Score:2, Troll)

        by ahodgson ( 74077 )

        Canadians pay it through income and sales taxes. You make $100K here you'll pay over $25K off the top in income and payroll taxes, and of what you take home you'll pay another 12% in consumption taxes on nearly everything (and a lot more on booze and, if you're dumb enough to smoke, on cigarettes). And municipal taxes through your rent (which in Vancouver is pretty high although not Bay Area high) or if you could ever buy a house (which you can't when only making $100K), direct.

        • Re:Another reason Canada is so attractive (Score:5, Informative)

          by timeOday ( 582209 ) on Monday September 28, 2020 @04:16PM (#60551780)

          Canadians pay it through income and sales taxes.

          Not really. Canada's per capita expense on healthcare is 7,068 CAD (in 2019), or $5,286 USD. USA per capita is $10,224 (in 2017).

          So, we spend about double.

          Much of that is administration costs. "The U.S. Spends $2,500 Per Person on Health Care Administrative Costs. Canada Spends $550."

          https://time.com/5759972/healt... [time.com]

          So for my family of 6, that's $12,000 more than Canadians simply down the drain every year JUST on additional administration costs.

          • Canadians pay it through income and sales taxes.

            Not really. Canada's per capita expense on healthcare is 7,068 CAD (in 2019), or $5,286 USD. USA per capita is $10,224 (in 2017).

            So, we spend about double.

            Much of that is administration costs. "The U.S. Spends $2,500 Per Person on Health Care Administrative Costs. Canada Spends $550."

            https://time.com/5759972/healt... [time.com]

            So for my family of 6, that's $12,000 more than Canadians simply down the drain every year JUST on additional administration costs.

            People are forgetting the lack of gun ownership, of quality and relatively low cost university, and in the general higher schooling of the average citizen. There is much much less stupidity in Canada when compared to the USA. And we have more longevity too.

        • Re: (Score:2)

          by mark-t ( 151149 )

          Depends on your province.

          BC, the province where Vancouver is located, eliminated all medical service premiums as of January 1st of this year.

          • Re: (Score:2)

            by ahodgson ( 74077 )

            Yeah you still pay it through taxes. And the NDP added a payroll health tax that employers pay that will also hit tech employers particularly hard.

    • Its got nothing to do with benefits. This site is not intended mainly for Canadians. Its intended for workers on the Federal Skilled Worker visa program. Its for foreign workers who can't get an H1B or workers that don't want to put up with the hassle of the US immigration system. The reason why its cheaper to hire there is because its easier to hire people on immigrant visas.

      https://www.canada.ca/en/immigration-refugees-citizenship/services/immigrate-canada/express-entry/eligibility/federal-skilled-worke

      • Re: (Score:2)

        by dskoll ( 99328 )

        That's unlikely. Immigration to Canada is pretty much shut down for the forseeable future because of COVID-19.

      • Yes, exactly that..

        Nortel in the 90s, had a big lab in RTP, NC and one in Ottawa. They'd try to hire in Ottawa because it was so much easier to hire foreigners from China on the cheap (Indians in IT weren't really a thing then). Salaries at the Canada lab were something like 40% or 50% less than they were paying in the USA at the time though cost of living was about the same.

        It didn't work out in the end though, it turned out a bunch of them were actually Chinese spies for (what eventually became) Huawei, t

        • Re: (Score:2)

          by dskoll ( 99328 )

          Weeeellll... there was more to Nortel's demise than that. I think the fact that senior Nortel officials engaged in fraud might have had something to do with it also.

  • But that might be just what they are going for.

  • Weak Loonie (Score:4, Informative)

    by lazarus ( 2879 ) on Monday September 28, 2020 @01:26PM (#60551166) Journal

    In case anyone is wondering a "weak loonie" is not a pejorative for a Canadian from the West coast...

    It's a reference to a Canadian dollar in the same vein as "greenback" is to the US currency.

  • Where the talent's cheap
    and the code ain't shitty
    Take... Me... Home....

  • Cost of Living (Score:5, Insightful)

    by CaptainPinko ( 753849 ) on Monday September 28, 2020 @01:30PM (#60551186)
    Sorry, but how much do you have to pay so that people can afford to live in Vancouver? Just about any city other than Toronto would be a better choice. Waterloo for starters.

    • My first thought. Vancouver is at least as expensive as SF, and these poor bastards are making less!?!?

      • Re: (Score:2)

        by ahodgson ( 74077 )

        Tech workers have it good here. The median family income in Vancouver is like $75K, and our taxes are higher than yours too.

    • Toronto isn't as good of a choice because its not within driving distance of the Seattle office.

    • Vancouver is conveniently in the same timezone as Seattle, and is close enough that driving is faster than flying. Microsoft has offices there for the same reason.

  • Last time I was in Canada, Canadians were complaining about jobs moving "south of the boarder" due to the low cost of labor in the US. This was 8 years ago.

    I also heard arguments that high taxes which fund the health care system put the nation at a disadvantage.

    How can this be then?

    If Amazon's argument for moving jobs to another country is built exclusively on exchange rates, this is a bad move. Exchange rates can turn on a dime. It's best to keep talent close to the consumer. That minimizes the e

    • Re:This Makes No Sense (Score:4, Insightful)

      by RichMan ( 8097 ) on Monday September 28, 2020 @01:35PM (#60551206)

      I would say Trump and the GOP have a lot of people looking at Canada very differently these days.

    • 1. The Labor cost may be lower in the US vs Canada on average. But They are spots that are much more expensive.
      2. Low Labor Costs can often come with a side effect, such as lower quality, higher turnaround, easier for competition to offer a better rate.
      3. High taxes for health care, vs Expensive private Health Care insurance It really is six on one hand and half a dozen on the other.
      4. The 2008 Recession hit the US much harder than Canada. This created a temporary lower wage level.
      5. Canada hasn't spent th

      • Re: (Score:2)

        by Strider- ( 39683 )

        3. High taxes for health care, vs Expensive private Health Care insurance It really is six on one hand and half a dozen on the other.

        Not really. The per capita expenditures on healthcare in Canada is about $4500 USD/year, whereas the US is $9500. So even factoring in the higher taxes, society still comes out ahead... not to mention our healthcare outcomes are better due to easier access to preventative care.

        • Not really. The per capita expenditures on healthcare in Canada is about $4500 USD/year, whereas the US is $9500. So even factoring in the higher taxes, society still comes out ahead... not to mention our healthcare outcomes are better due to easier access to preventative care.

          You're saying the average US citizens' medical expenses are $9500/year?!?!?

          Really?

          How do you possibly get to a figure like that?

          • Re: (Score:2)

            by dskoll ( 99328 )
            The figure is from the OECD. As the data [oecd.org] show, the USA spends far more per capita on healthcare than any other country, yet health outcomes are no better or worse [jamanetwork.com] than many other developed countries.

          • Easy...

            Just got a bill for an ambulance ride (1/4 mile only, no special services..just the ride to the hospital). Cost was $2500 (US).

            That was just the ride.. it was way more once arriving at the hospital.

            Another case, had a simple 1 hr surgery... went home right after... billed to the insurance company $35,000 (US)

            Read about the doctor that got billed $10,000 for a simple covid test (google it, it is the first item that shows up).

            So yeah, thats how...

            • Re: (Score:2)

              by dskoll ( 99328 )

              Holy smokes! $2500 for an ambulance ride??? Ambulance transportation is not covered in Canada, but the last time I had to pay for an ambulance, it cost me $75 (CAD).

              Americans, you are being completely ripped off.

            • I'm sure these bills hit people, no doubt.

              However, the "average" person does not get hit with $2500 ambulance bills or $$ surgery bills annually.

              I have a hard time believing that enough US citizens are so sick that they require these services to make the average for all US citizens to be this $$.

              Is it too expensive for those that do get hit by it, yes of course.

              But I don't know that I've ever spend that much money on health needs in a year and I"m getting up there in age.

    • My sister was doing her PhD in Archaeology. A position opened up at UBC, and they received hundreds of applications, mostly from professors in the USA trying to find somewhere else to teach.

      The brain drain thing has been true for a long time—the biggest companies paying the most money with the most interesting projects have historically been in the USA. Want to work for Apple or Google? Their main campuses are in California. Even though there's a Google office here in Montreal, it's not the same as th

    • Re: (Score:2)

      by tlhIngan ( 30335 )

      Last time I was in Canada, Canadians were complaining about jobs moving "south of the boarder" due to the low cost of labor in the US. This was 8 years ago.

      No, it wasn't jobs, it was people, aka "brain drain".

      Opportunities are better in the US, taxes are lower and pay is higher. So the high-tech industry in Canada was moving south to higher paying jobs with lower taxes.

      It's not the low cost of labor in the US, it's the fact the US pays more.

      Of course, what has happened since then is the realization that the

  • Vancouver is relatively cheap.
    Winnipeg is really cheap.

    • I want to know relatively cheap compared to where. Monaco? St. Bart's? The ISS?

    • Vancouver is relatively cheap.

      Vancouver is NOT cheap. I am born and raised in and around Vancouver. I make very good money, and I can not buy a home in Vancouver. I live in a small town about 80KM (50miles) from where I work in downtown Vancouver. Buying this far out was the ONLY way I could buy something to call my own.
      Even with this issue, there are some significant benefits.
      It is probably one of the most beautiful places on earth.
      Despite what you have been told, our healthcare is fantastic.
      A reasonable amount of vacation and Sta

      • Re: (Score:3)

        by PPH ( 736903 )

        Yeah. Didn't you folks have some trouble with foreigners coming in and buying up all the desirable housing a few years back? And the solution was to impose a tax on non resident property owners? I just picked up on bits and pieces of the news, as I'm just over the border in Bellingham.

        It is probably one of the most beautiful places on earth.

        It's a great city and I enjoy visiting frequently (no so much since the Covid border lockdown). And it's not really a problem switching to driving on the other side of the road either.

        • Yeah. Didn't you folks have some trouble with foreigners coming in and buying up all the desirable housing a few years back? And the solution was to impose a tax on non resident property owners? I just picked up on bits and pieces of the news, as I'm just over the border in Bellingham.

          It is probably one of the most beautiful places on earth.

          It's a great city and I enjoy visiting frequently (no so much since the Covid border lockdown). And it's not really a problem switching to driving on the other side of the road either.

          I love Bellingham. Yes, we had a lot of foreign buyers of realestate, and that tax didn't really help much/any. But living here I would say the biggest problem is that if anyone is moving to Canada they want to move to one of two places, Toronto(God help them) or Vancouver. Even people moving within Canada are mostly heading to the same two cities. Vancouver is surrounded on all sides, so can't simply expand. I am really lucky I bought when I did. My house has more than doubled in value in the 7 years I hav

    • I really like Vancouver, but "Relatively Cheap" is not something I have ever heard associated with it nor would I ever use to describe it.

      • Re: (Score:2)

        by sl149q ( 1537343 )

        Just needs to be relatively cheap compared to Seattle, San Francisco and Los Angeles.

        • I would have thought the talent costs would have been relatively similar between Seattle and Vancouver. If it is significantly cheaper how the hell do people afford to live in Vancouver as that is a damn expensive city.

          • I would have thought the talent costs would have been relatively similar between Seattle and Vancouver. If it is significantly cheaper how the hell do people afford to live in Vancouver as that is a damn expensive city.

            (I live in Vancouver) Many locals (especially families) have indeed been priced out of the city. They end up moving to Vancouver Island or the interior of BC or something because spending > 50% of your income on rent is not sustainable. However it's a bit easier for couples and single people are there are a lot of 1-2 bedrooms condos in the downtown area. There are thousands of units within easy walking distance of the new Amazon office and skytrain isn't far either.

    • Vancouver is cheap my ass.

      I'm trying to get out of here so I can find a place I can actually afford to buy into.

  • Comment removed (Score:3)

    by account_deleted ( 4530225 ) on Monday September 28, 2020 @01:36PM (#60551210)
    Comment removed based on user account deletion

  • Re: (Score:1, Informative)

    by account_deleted ( 4530225 )
    Comment removed based on user account deletion

    • So there coming to "Communist Canada", with it's evil single payer healthcare

      • Re: (Score:1, Informative)

        by account_deleted ( 4530225 )
        Comment removed based on user account deletion

        • Re:It's not about the labor cost. (Score:4, Insightful)

          by Major_Disorder ( 5019363 ) on Monday September 28, 2020 @02:51PM (#60551506)

          If they can't want to wait to see a doctor, they can visit the USA like any other Canadian with an urgent need can do. Still worth it to be out of Seattle.

          -jcr

          NOBODY does this. It is Pure 100% BS As a Canadian if I need to see a Dr. I call the office and make an appointment, usually within a day or two. If it is more urgent than that I go to the ER. Whichever I go to, I show my carecard and I am done. No enormous bills, no BS copays, no this Dr. is not covered because they are in the wrong HMO.
          The Canadian system is not perfect, but I do not know a single Canadian who wants the foolishness and expense of the US healthcare. I have also never know of a single Canadian to go to the US for healthcare. Ever.

          • Re:It's not about the labor cost. (Score:5, Insightful)

            by SilverJets ( 131916 ) on Monday September 28, 2020 @03:17PM (#60551598) Homepage

            " I have also never know of a single Canadian to go to the US for healthcare. Ever."

            It does happen but it's mostly for experimental treatment not approved for use in Canada or people who need a non-life saving procedure and do not want to wait their turn.

            Canada's healthcare is set up like triage. If you have an immediate life-threatening need you jump to the front of the queue. This sometimes pisses off people that are waiting for knee surgery or some other non-life saving procedure who then get bumped. But, too fucking bad. I'd rather get my "free" healthcare and have to wait a bit than deal with the crap system the US has where those with money get helped and those without die.

          • Re: (Score:2)

            by nnet ( 20306 )
            heh wait til Rowe v. Wade is overturned. They'll be flocking to the border for fixes.
          • Comment removed based on user account deletion

        • My ex-wife had cancer and had surgery within two weeks of diagnosis. There's a lot of bullshit about Canadian health care out there, but I'm bloody glad I don't have to contend with the American's bloated, insanely expensive system with its results basically mapped directly to how much money is one's wallet.

          • You get the same FUD Australia gets about its system. I think it comes from Americans that don't want to acknowledge the fundamental problems with the health care there so they do things like compare different aspects to claim America is great. e.g. the common one they use for us is, we have to wait to have surgery where it is immediate there. The reality is it is immediate here too unless you are having elective surgery on the public purse, whereas in the US such surgery would just not happen or send the p
          • Comment removed based on user account deletion
            • if you had bothered to look closely the study is garbage. What they call "medically necessary" are things like elective knee and hip surgery,. oncology (cancer is listed as 4 weeks). Incidentally just like the US if you have insurance or are willing to pay it can be whenever you like.

    • To a much more left leaning country, where they have the police properly trained, and tempered so such people don't feel the need to riot about the injustice happening to them.

      • Comment removed based on user account deletion

        • You mean how many of these people the parents needed to tell their children even before the Sex Talk on how to deal with the Police, because one miss word, or action will get you killed. Yea those parents are really bad.

          Floyd is a spark on what was already a building up situation. However too many of us ignored the problem, and just blamed them for not following the rules, for a game stacked against you.

    • Re: (Score:2)

      by dskoll ( 99328 )

      If Amazon finds Seattle too "leftist", they're in for a surprise in Vancouver... troll.

    • Could it be they're worried about a second Trump term instead?

    • Re: (Score:2)

      by dryeo ( 100693 )

      You know BC actually currently has a socialist government (well actually there's an election on so only a caretaker government), which is one of the reasons we have the best economy in Canada, low taxes, a government with a very high approval rating, a right to protest against fascists killing coloured people without fascists sneaking into the protests and lighting fires.

      • Comment removed based on user account deletion

        • Re: (Score:2)

          by dryeo ( 100693 )

          There's a long history of governments turning peaceful protests into violent protests, not that extremists on either side don't do it. Anyways the point is that all the protests here, mostly what you would call left wing as they're for equality, have been peaceful. As our right wing are more the the traditional conservatives, they're not likely to inflame things either.

  • When US companies started moving development overseas to India and other countries where language and culture were barriers to getting quality work I was left wondering why they didn't move north.

    • I think because they were looking for the huge win. Cutting costs modestly - say 20% - doesn't compare with paying someone in India 75% less, with much of that 75% going into their own pockets as bonuses. Only later did they realize that when you pay 75% less in India, you get like 150% less productivity. Now they're looking closer for the smaller win, though I still expect much of that 20% difference to add more mahogany decking to their yachts.

  • Big companies: stop killing cities!!! (Score:4, Insightful)

    by RickyRay ( 73033 ) * on Monday September 28, 2020 @02:13PM (#60551330)

    Every time a big software company puts a huge office complex in a normal city, they kill the city.

    Dallas used to be affordable, but when Toyota merged its HQs north of Dallas, a bunch of other companies did the same, and housing costs quickly doubled. Salt Lake City was affordable, but then Goldman Sacks, Adobe, and others set up large offices, and now housing has likewise gone out of control.

    The claim is that they are benefitting their communities, but they never play fairly. For example, a major shoe manufacturer has been battling in the courts with the town they are based in, near Portland Oregon, for decades. They have been threatening to move out of the state if the lot their HQ is on gets incorporated into the city, since that would mean they have to pay city taxes like every other business in the area (this is easy to back up with the public record). Now that there is an extreme deficit in covering school costs, that same company is pushing for legislation to have increased taxes based on gross receipts, which again makes it so everybody but them has to cover the costs, since that company does all of its manufacturing overseas on the cheap.

    Big companies in Seattle and in the Bay Area have been pulling similar scams all along, which is a huge factor in how their CEOs and similar take home absurd amounts of money. A business is more profitable if you have iffy lawyers and accountants get you out of paying your taxes, which leaves government infrastructure and education costs uncovered, and messes up the town for everybody (with the money going instead to a few mansions, yachts, and other meaningless purchases...).

    The remote work scenario right now during the virus crisis has shown us that a well-managed team can effectively work remotely, and that a lot of the office costs for the company are just wasted. But big companies don't care. I suspect a huge factor is that they are trying to keep it less practical for their employees to jump ship to a competitor (it's easy to change jobs when the location is "don't care"). Which is further proof that employers value their employees, and don't value their community at all.

    • Pull your head out. It's the cities fault for now allowing enough housing to be built as industries develop, causing a bidding war. Vancouver is already much more expensive than Seattle or Portland, despite lower median salaries. Our pitfall is allowing too much overseas and illicit capital to flood in, without forcing that same capital to do anything useful other than support the housing market. Real well paying jobs would be a boon here.
      • Vancouver really is a bit different where local property values are quite detached from our salaries. I'm thinking that Amazon providing decent paying employment for our local computer science grads will be largely a good thing as more locals can afford properties here while paying provincial and federal income taxes. There is a lot of land in Vancouver tied up with folks who declare no income at all because they don't work.

  • It's cheaper... (Score:3)

    by tchdab1 ( 164848 ) on Monday September 28, 2020 @02:37PM (#60551442) Homepage

    ... to hire in a western country with universal health care and better labor protections than to do it in the USA.

    For all of you that still feel otherwise.

  • https://slashdot.org/story/20/... [slashdot.org] They should read the article above this one.

  • The only ones you may get cheaply in some areas is mediocre and worse people. Hiring them usually is far more expansive when all is considered than hiring the really good people. Also see the nice ransomware epidemic that is currently running for some of the costs that come with mediocre people.

  • Great for Indians stuck on GC queue in america (Score:4, Informative)

    by zshXx ( 7123425 ) on Monday September 28, 2020 @07:54PM (#60552306)
    There are ton of Indian tech employees in Amazon Seattle who are patiently waiting for Green Card from years now. These are not H1 abusers from Indian consultancies but either transfer from Amazon India or Masters degree holders from US. I see many such folks choosing to move out to Canada/Europe from Amazon Seattle already because they are done with h1 renewal bullshit every 3 years with no GC in sight. Source: I am an Indian engineer in Amazon Seattle who is stuck in GC queue from nearly 8 years. Lot of my friends are in same boat.
    • This is what really sucks about our immigration policy. On one hand, we allow companies to import armies of h1b "guest workers" to drive down our wages, then go home and spend their pay in a much cheaper environment. But on the other hand, people who want to immigrate - to become Americans, stay in America, and be a long term asset to the country - are given a long wait and a miserable run around. It's almost like our Progressive overlords don't actually give a fuck about immigrants, but definitely do like

  • TFW and H-1B (Score:4, Interesting)

    by spaceyhackerlady ( 462530 ) on Monday September 28, 2020 @08:59PM (#60552450)

    I've seen too many of these setups where the real reason to set up shop in Vancouver was that only so many H-1B visas were available in the U.S. so they brought Temporary Foreign Workers in to Canada. Cheap, do as they're told, go home when they're done, bring in some more.

    I'm from Vancouver, BTW.

    ...laura

    • That makes no sense, because somebody on a worker visa in Canada is in a much stronger position wrt their employer than they are in US - they can apply for permanent residence without their employer's backing; it's much easier and faster to get than green card in US (because it's a point-based system, not quota-based); and unlike H1Bs in US, you don't get instantly kicked out of the country, but get a considerable grace period to find another suitable job.

    • Re: (Score:1)

      by zshXx ( 7123425 )
      If a company is setting up shop in Canada, they will definitely prefer to hire local and save all relocation costs. Getting educated labor from another country isn't necessarily cheap. There might be one off cases of smaller consultancies but that's now how Amazon and rest of tech companies roll. They pay high and will hire local gladly if people are available with skills. If not, they are importing talent which is good for country in long run.

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