VICTORIA, BC (June 25, 2020) - Compared to other sectors, local tech companies are faring quite well and, as always, they are optimistic about their ability to recover and grow going forward. Over 44% of the 88 respondents have seen stable revenues or an increase in revenues during the crisis. As is to be expected, some companies are struggling and may not survive. Six and a half percent have experienced a decrease in revenues of 50% or more. Generally, tech companies are confident they can survive over the longer term. Almost 75% of respondents feel their company can endure the current lockdown for at least one year, with almost half of respondents believing they can survive under the current conditions indefinitely.
The overall health and stability of this sector is also reflected in the minimal use of government programs. Based on the responses to questions about revenues, it is likely that many Victoria tech companies did not suffer enough decrease in revenues to qualify.
The Canada Emergency Wage Subsidy (CEWS) is by far the most utilized program with 29.5% of respondents participating which requires a 30% drop in revenues to qualify. The Canada Emergency Commercial Rent Assistance Program (CECRA) is barely used with only two respondents leveraging the program due to its requirement to demonstrate a 70% drop in revenues to qualify. In an effort to help support and stabilize the sector, VIATEC waived $64,000 of rent in April and May and provided a 25% discount in June for its startup tenants in Fort Tectoria where only two tenants qualified for the rent relief program.
Given their agility and global focus, it is likely that the local tech sector will rebound quickly and move from the recovery stage, to innovative improvements and ongoing resiliency faster than most other sectors. Almost 30% have increased their head count during the crisis while 23% have decreased their staffing levels and almost 47% have had no change.
This survey shows that local tech companies are eager and ready to grow both revenues and head count even during the lockdown and it is likely that our region will have a stronger tech sector in the not too distant future. Half of respondents plan to increase their head count once the crisis has ended. The VIATEC online job board had 110 postings at the end of February. That number dropped all the way to just 35 in April but has since rebounded to 82 active job postings. VIATEC offered its members free job postings in April, May and June and to date over $12,000 in free job postings have been provided during that time.
“Typically, following a major crisis, governments turn to infrastructure spending as a way to kick start the economy,” notes Dan Gunn, CEO of VIATEC. “Going forward we are hopeful that governments looking to assist in economic recovery and resilience will recognize that investing in digital communications and treating talent as infrastructure (while not swinging too quickly towards austerity), will provide the stability and resources for our region and Canada to make significant gains on the global stage.”
“Concerns centre around U.S. travel restrictions, supply chain issues and maintaining company culture within a remote team. On the flip side, 75% feel productivity has stayed the same or increased while working remotely. While we do not have the specifics of staff size per respondent, it is noteworthy that respondents reopening their offices are predicting that 60% of their staff will continue to work remotely. Additionally, the need for remote software solutions has accelerated demand for new and currently developing technologies, while the drop in CAD relative to USD has led to increased revenue.”
VIATEC (Victoria Innovation, Advanced Technology and Entrepreneurship Council), started in 1989. VIATEC's mission is to cultivate the most cohesive tech community in the world by providing resources to tackle shared opportunities and challenges while boosting a sense of belonging and shaping our region. (Victoria's biggest industry is tech!).