Software Engineering Talent Comparison: Toronto vs. Kitchener/Waterloo

Which city is best for Software Engineering Talent?

9 Nov 2021
Images courtesy of Scott Webb on Unsplash, Tom1973 on Wikimedia, and ExploreWaterloo

What comes to mind when you hear the term “tech hubs”? Do you think - Silicon Valley, Boston, Seattle, NYC, or LA?

While Silicon Valley is still the largest tech hubs, Canadian cities like Toronto and Kitchener-Waterloo are closing the gap fast. Both cities have growing software engineering talent pools and make for highly attractive office locations.

But which city is better for software engineering talent? To figure this out, we need to take a deep dive into the talent data to analyze these cities.

Software Engineering Talent Pool Size and Quality

Your office location can make a material impact on how you recruit top talent. While it’s easy to look at talent pool size as the most important factor, a large talent pool doesn’t mean you’ll get the recruitment results you want. That’s why we’ve gone beyond size and introduced the ability to quantify the quality of software engineering talent globally, providing a multi-dimensional, deeper, and more complete way of analyzing talent. Using a proprietary, in-house machine learning model, we calculate talent quality which ranks engineers based on work experience, academic history, open-source contributions, and more.

According to our data, Toronto’s talent pool is more than 8x largerthan the talent pool in both Kitchener and Waterloo combined. Toronto also has a denser talent pool at 61 software engineers per sq. km. In contrast, Waterloo has 46 software engineers per sq. km., and Kitchener only has 15 software engineers per sq. km. Based on size and density, Toronto beats out the Kitchener-Waterloo area for software engineering talent.

However, both Kitchener and Waterloo have higher quality talent pools. Kitchener has the highest quality talent pool, followed by Waterloo, with Toronto coming in third. Although Toronto has 17x more talent than Kitchener and 15x more talent than Waterloo, the Kitchener-Waterloo area is a better choice for high-quality talent.

Software Engineering Talent Population Growth

Another key comparison metric for software engineering talent pools is population growth.

Over the past 3 years, Kitchener has grown its headcount of all roles in the high-tech (software/internet) industry 3x faster than Toronto. But, in the last 12 months, Kitchener’s growth of high-tech roles has slowed to a similar pace as Toronto.

Over both the last 3 years and the last 12 months, Waterloo’s high-tech talent has grown at a slightly slower pace than Toronto. While Toronto and Kitchener are currently similar in growth, Kitchener has been the best for software engineering talent pool growth historically, followed by Toronto, with Waterloo in third.

Software Engineering Talent Diversity

Diversity is another important talent pool metric to consider, in addition to talent pool size, quality, and growth.

Toronto is much more diverse than either Kitchener or Waterloo. Compared to Kitchener, Toronto has a 48% higher non-white software engineer population. Toronto also has a 35% higher non-white software engineer population than Waterloo. In terms of female software engineers, Toronto also has a slightly higher talent population than either Kitchener or Waterloo.

From a diversity perspective, Toronto is a better city for software engineering talent.

Software Engineer Talent Tenure and Salary

When comparing the software engineering talent pools of cities, two other important metrics we look at are talent tenure and salary.

Both Toronto and Waterloo have a higher average tenure than Kitchener. Toronto and Waterloo’s average tenure for software engineers is 5 years, whereas Kitchener’s average tenure is only 4 years. Interestingly, software engineers’ salaries are 15% lower in Toronto than in Kitchener, despite Toronto also having a longer tenure.

Conclusion – Which City Is Best?

So which city is better for software engineering talent, Toronto or Kitchener-Waterloo? Each city has its tradeoffs, so the answer really depends on what talent pool characteristics are most important to you.

Toronto has a much bigger and more dense software engineering talent pool than Kitchener-Waterloo, and has a more racially diverse talent pool as well.

While Kitchener-Waterloo has a smaller talent pool, they both have a higher-quality talent pool than Toronto. Kitchener’s high-tech industry personnel (all roles) headcount has also grown almost 3x faster than Toronto’s in the past 3 years. However, in the last 12 months, Kitchener’s talent pool growth has matched Toronto’s.

Software engineers’ tenures are 25% longer in Waterloo and Toronto than in Kitchener. However, as noted before, software engineering talent is paid 15% higher in Kitchener than in Toronto. This indicates factors other than salary, such as workplace satisfaction, could be contributing to the better retention in Toronto than Kitchener.

In sum, if you’re looking for a larger, more diverse and higher-tenure city, Toronto could be a good fit for you. The Kitchener-Waterloo area could be a better pick if you’re looking for a city with a higher-quality talent pool that’s faster-growing.

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