New ranking says Toronto has fallen from its former tech hub glory

Toronto's tech scene, touted for its rapid expansion and wealth of talent in recent years, is now slipping in North American rankings.

This time last year, experts began worrying about the downturn of the once-booming industry compared to its heyday just months before, and commercial real estate group CBRE has just confirmed with a new report that Toronto has indeed fallen from its spot as third-best place for tech workers, which it secured in July 2022, to fifth.

This year, the city's tech talent scorecard ranking was 66.5, compared to 82.5 for the SF Bay Area, 71.4 for Seattle, 67.4 for New York Metro and 66.7 for Washington, D.C.

Experts are saying that Toronto's once-thriving tech sector is now in a downturn https://t.co/sMsQ12LAE5 #Toronto #Tech

— blogTO (@blogTO) August 18, 2022

Though the whole sector has cooled, five other Canadian markets managed to move up the list based on factors like job growth, talent concentration, labour costs, commercial real estate trends, and more, including Vancouver, which landed in eighth place with a score of 60.6.

T.O. added 63,800 tech talent jobs between 2017 and 2022 — the second-most of any city in the continent, after only San Francisco — but our massive glut of empty office space post-lockdown has been a cause for concern.

As of this month, office vacancy rates in the city have reached 18.1 per cent, which is the highest level in almost 30 years. We also have a lower concentration of tech talent (percentage of total employment) than Ottawa, San Fran and Waterloo.

"Tech talent remains in high demand despite economic uncertainty and employment reductions. Remote and hybrid work will benefit tech talent employers and challenge some office markets with reduced demand," the report reads.

But, it also notes a high number of layoffs in 2023.

"Overall tech talent employment grew by 11 per cent between 2020 and 2022, with tech companies adding nearly 2.5 times more tech workers than the next highest industry sector...  but as the economy slowed in the second half of 2022, tech companies began laying off employees, many of whom were in non-tech roles like sales and marketing."

Despite layoffs at companies like Ritual, Shopify and others here at home, Toronto remains the largest and best tech hub in Canada, with tons of renowned companies maintaining a strong presence and still hiring.