Amazon Cleverly Taps Global Labor Market For Vancouver Expansion

Amazon is shrewdly capitalizing on Canada’s more open immigration laws and importing engineers from other markets.

AWS Vancouver

Amazon Web Services (AWS) is on a hiring spree in Vancouver, Canada, but it isn’t relying exclusively on homegrown talent.  Instead, it is leveraging Canada’s immigration system to fill the engineering bench required to build AWS products, and to support the tech giant’s head office, which is only 230 kilometers away in Seattle, WA.

“In Vancouver, those hires are all engineers working on the AWS product line,” says Jarrod Levitan, Chief Cloud Officer at TriNimbus, a Vancouver-headquartered AWS partner that provides AWS migration, architecture and DevOps solutions. “The requisitions are for non-customer facing positions, because right now Amazon has no customer facing presence in Vancouver.”

Amazon is looking to fill, in total, as many as 1,000 positions at its 91,000 square foot office in the 22-story Telus Garden office tower in downtown Vancouver, which can expand to 156,000 square feet. At present, the company has about 300 positions open in Vancouver.

To find the right people, Amazon is taking advantage of Canada’s more open approach to immigration. Unlike the United States, which has a cap on the number of foreign workers, Canada doesn’t have a limit. Janko Jerinic, a Senior Software Development Engineer at Amazon, and a native of Serbia, says that Amazon’s Vancouver setup has “room to hire literally hundreds of engineers, and we are bringing them from all over the world.”

Part of the reason for this hiring surge is Canada’s policy of favoring economic immigrants, prioritizing solid candidates that match job offers and in-demand skills. There’s a good argument for this strategy: according to Canada’s Information and Communications Technology Council (ICTC), Vancouver will need to fill 15,500 ICT positions by 2019. To solve this problem, Amazon is relying less on Canada’s fast-track for permanent residents, and focusing instead on temporary workers.

Temporary Relief

“Processing for an immigrant visa takes time,” says Bruce J. Harwood, an immigration lawyer with Boughton Law in Vancouver. “Despite Canada’s express program for immigration, it’s far faster to go through the temporary worker program.”

The temporary program has two steps: first, the employer requires a Labor Market Impact Assessment (LMIA), indicating that there is a need for a foreign worker, and that no Canadian worker is available to do the job. Usually, a positive LMIA requires a search of at least 30 days for a Canadian candidate. The next step is for the foreign candidate to apply at the Canadian consulate in their country of origin.

“The Canadian government will grill an employer,” says Harwood. “They’ll call Amazon and ask about wages, ask what efforts the company put in to find Canadians. The government can be very picky, and demanding about what they want to know. In fairness, that’s their job.”

The prospective worker is then assessed based on a points system. Amazon won’t get many points for filling positions in Vancouver – companies are rewarded for putting people in smaller towns and rural areas. But it will do well as long as the wages are high in a provincial context.

“Amazon is paying well above the provincial average, which now sits at about $22.60 an hour,” says Harwood. “These are skilled people with knowledge, and the government wants them to come.”

Cross-Border Transfers

Nonetheless, the process can be bureaucratic, and Amazon, like any tech company, is looking for ways around the skilled worker program. One alternate route is to hire a worker from the United States, where NAFTA allows a person to apply at a port of entry, with no visa. All the candidate needs to do is to provide proof of employment, citizenship, and education, and they will be dealt with on a same-day basis. But the US has low unemployment in ICT, and Harwood isn’t seeing a surge of interest from south of the border.

“Another option for Amazon is inter-company transferees,” he says. “Under general immigration regulations, you can bring in a person with specialized knowledge from a parent, or affiliate, or subsidiary, outside of Canada – as long as they’ve worked for you for one year. And that doesn’t require an LMIA.”

This may be an effective, longer term plan for AWS, which opened a new region in Mumbai, India, this summer. The more regions AWS has, the more it will be able to hire and train employees in places like Mumbai and Sao Paolo, Brazil, and then move them to Canada. This is a global labor pool that can be developed within a larger corporate strategy.

“AWS is expanding into markets where there is significant demand for their platform services – it is customer driven,” says Paul Goldman, Founder and CEO at AWS partner iTMethods, which has its headquarters in Toronto. “Eventually, AWS will have at least one Region in every significant economy in the world, delivering innovative utility cloud services as a global platform.”

As it stands, an Indian hire hoping to get an AWS job in Vancouver as a temporary foreign worker can expect a six month application wait time at the Canadian embassy in New Delhi. Like many countries, India is not visa exempt, which means applications have to travel through the diplomatic bureaucracy.

Amazon’s Tight Lips

Amazon is notoriously tight-lipped with it comes to their corporate strategy. Though they will announce expansions and partnerships, and allow a certain amount of freedom to their employees to express their opinions, the company itself has a low-key approach to marketing.

“Amazon wants to keep their secret sauce close to their chest,” says Levitan. “Their approach, even at their conferences, is to educate people rather than market or sell to them. It’s a cultural thing – they don’t disclose a lot to the public until it is ready to go. It’s how they’ve grown as a business. Even Amazon as a retailer is not that public-facing.”

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With regard to Vancouver, Amazon pumps the lifestyle factor, saying that the city is “beautiful and bustling” and a great place to “have fun”.  What they don’t promote – and this appears not to be a part of their strategy – is Vancouver as a stepping stone to employment in the United States. Canada is looking for candidates to help build its own economy, and a company could face serious fallout if the government determines that the immigration process is being abused to provide access to the US. But, given the investment in office space, Amazon’s commitment to Vancouver seems legitimate.

“This is very much about growth,” says Levitan from TriNimbus. “AWS is growing rapidly and hiring all over. Vancouver itself is a hot bed for technology, with tons of people in the tech field here. A lot of organizations are here, like EA Canada and Hootsuite.”

One issue with the plan to draw more tech talent to Vancouver is the cost of living – specifically housing. The city’s real estate market has been on fire for years, driven by both foreign and domestic demand.  To address this issue, the provincial government recently announced a 15 percent levy on overseas property investors.

But this may assist the local tech industry given that, according to a June 2015 report by BC Stats, the central statistics agency for British Columbia, ICT jobs in British Columbia pay on average 43 percent less than those in California. Putting the brakes on housing costs could make the city more affordable, and control wage inflation, an important factor for AWS.  As it stands, Amazon employs 15,000 people in nearby Seattle, where it has its headquarters, out of a global headcount approaching 100,000. To support those operations, the Vancouver initiative needs to remain viable.

An AWS Plan For Canada

Amazon’s Vancouver story fits into a bigger AWS plan for Canada. The company is hiring in Ottawa, Toronto, and in Montreal, where it plans on opening its first Canadian data center by the end of 2016. Historically, data residency concerns have slowed cloud adoption for some large Canadian companies in key industries, but that’s about to change.

“The new AWS Montreal region will certainly positively affect public sector and financial services clients who have to store certain types of sensitive data in Canada, but who also need the elasticity and scale of a leading public cloud platform,” says Goldman from iTMethods.

However, AWS customers can already control their encryption keys in AWS, and they have much more in the way of security and privacy capabilities when compared to on-premise systems.  Beyond those concerns, improved service delivery in the context of Big Data and the IoT will be driving Canadian adoption.

“Canadian businesses will benefit, of course, from being able to receive IT services dramatically better than the ones most of them have access to today,” says Ian Rae, founder and CEO of CloudOps, a Montréal-headquartered cloud computing consulting firm and AWS partner. “And an AWS presence in Canada will remove the biggest perceived obstacle for those Canadian businesses who prefer to keep their data in Canada.”

The plan for AWS to establish a Montreal region by the end of 2016 is also expected raise the company’s low profile across Canada.

“The global market is quite AWS aware, and would be more likely to know of this expansion than folks in Canada,” says Rae. “The Canadian market is far behind in terms of cloud transformation, with just enough exceptions that prove the rule. All that is set to change starting in 2016, and we expect things to move quite rapidly in the next few years.”

 

 

 

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