OTTAWA – Canada’s cybersecurity industry has grown and thrived during a time of serious uncertainty, and is well-positioned to help defend Canada and protect Canadians in cyberspace as new threats emerge.
Innovation, Science and Economic Development Canada (ISED) and Statistics Canada — in close partnership with the Canadian Association of Defence and Security Industries (CADSI), the Council of Canadian Innovators (CCI), and TECHNATION Canada — today released the latest edition of the State of Canada’s Cybersecurity Industry Report, based on 2020 year-end data.
Link to Report
This report, produced every two years, shows an industry with a high export volume that is STEM-oriented and R&D intensive, and growing rapidly – with 30% growth in revenues and employment between 2018 and 2020. The industry is dominated by Canadian-owned firms engaged in cutting-edge R&D. Across many indicators, it outperforms the broader Information and Communications Technology industry.
The report also provides insights into the performance of this industry during the first year of the COVID-19 pandemic, the geographic distribution of Canadian firms, related industrial capabilities, and labour force characteristics. The cybersecurity industry’s revenues are significantly derived from exports, with close to 80% of those exports accounted for by Five Eyes partners.
“Canada’s cybersecurity industry is instrumental in ensuring the safety of Canadians’ digital information and the networks which we all rely on,” said the Honourable François-Philippe Champagne, Minister of Innovation, Science, and Industry. “Cybersecurity also enables Canadian firms across industries to access global markets securely. A 30% growth in revenues and employment is significant and represents an increase of nearly $900 million in GDP and close to 7,000 jobs.”
“Canadian cyber companies compete, and win, in a fiercely competitive global marketplace,” said Christyn Cianfarani, President and CEO of CADSI. “This sector is punching above its weight on the international stage, but we see enormous potential for growth here at home when it comes to the amount of business these firms do with their own government. Currently that accounts for just 8% of revenues.”
“Canada’s high-growth cybersecurity sector is filled with homegrown companies punching above their global peers. The government must get behind these companies to sustain this momentum,” said Nick Schiavo, Director of Federal Affairs of CCI. “As we look to the future of Canada’s cyber posture, it’s critical our governments and security agencies understand the role these firms play in securing both our national and economic sovereignty and co-develop strategies with industry that spurs innovation and economic development in our cyber ecosystem.”
“Canada’s cybersecurity industry is world-class with an extremely talented workforce; however, our adversaries are rapidly advancing by heavily investing in cyber espionage which poses a threat to Canada’s national security,” said Angela Mondou, President and CEO of TECHNATION Canada. “There is an immediate need for Canada’s cybersecurity industry, in partnership with government experts, to develop a National Cybersecurity Action Plan to both offensively and defensively manage the critical communication, energy, and public infrastructure. I believe the Canadian government is committed to working in close partnership with industry cybersecurity leaders to ensure the security of all Canadians.”
Canada is the first among OECD countries to conduct an in-depth Government Statistical Agency survey on cybersecurity industry capabilities from the supplier perspective, complementary to Statistics Canada’s ‘Survey of Cybersecurity and Cybercrime’ which provides data from a user perspective.
This report will provide industry and policymakers with a comprehensive picture of Canada’s cybersecurity industry, allowing them to make better-informed decisions.
Key Takeaways and Statistics
Growing: The cybersecurity industry saw 30% growth in both revenues and employment between 2018 and 2020, driven by growth in cybersecurity infrastructure solutions. The industry also saw a 35% increase in R&D spending over the same period.
Canadian-led: Of the nearly 500 firms in Canada’s cybersecurity industry, 85% are Canadian owned. Canadian-owned firms led revenues (65%), employment (72%), R&D (81%) and exports (77%).
Intensive R&D: The industry’s R&D intensity (the ratio of R&D performed relative to its own GDP) is 21%. That’s nearly 2.5 times greater than the Canadian ICT industry average, making cyber one of the most R&D-intensive industries in Canada.
Reliance on SMEs: 90% of companies have fewer than 250 employees.
STEM Competency: Over half (56%) of cybersecurity industry employees work in STEM, six times the level of the broader industrial base.