2008 Annual Toronto Region Innovation Gauge

2008

Annual Toronto Region Innovation Gauge

TABLE OF CONTENTS 2 Executive Summary 4 Introduction 6 At A Glance 8 Who We Are 18 What We Offer 27 How We Are Performing 32 Conclusion 34 ATRIG Advisory Council 36 Appendix 1 – Selection of Comparator Regions 43 Appendix 2 – Methodology/Data Sources 53 Appendix 3 – Selected Sector Profiles 58 Appendix 4 – List of Acronyms 59 Endnotes

2008 Annual Toronto Region Innovation Gauge

EXECUTIVE SUMMARY

1

EXECUTIVE SUMMARY “Research is to see what everybody else has seen, and to think what nobody else has thought.”

- Albert Szent-Gyorgyi, Hungarian Biochemist, 1937 Nobel Prize for Medicine

The Toronto Region has an innovative research base with a highly-educated and growing population that benefits from a diversified manufacturing base and other major advantages compared to its competition – that’s the good news.

However, the Toronto Region faces some significant challenges to meeting its full potential to become one of the top research capitals in the world. The obstacles to be overcome include the need for even more postgraduate students, stronger governmental support for research and development, more private sector R&D, and greater focus on knowledge and technology transfer.

That’s the conclusion reached from a review of the Toronto Region’s research and innovation system conducted by the Toronto Region Research Alliance (TRRA).

2008 Annual Toronto Region Innovation Gauge

The second edition of the Toronto Region Research Alliance’s Annual Toronto Region Innovation Gauge (ATRIG) analyzes the current strengths and weaknesses of the region relative to other regions with strong research bases, like Silicon Valley in California and Massachusetts, and to more comparable research centres, like the Research Triangle in North Carolina, Montreal, Illinois and Michigan.

2

WHAT WE OFFER The Toronto Region is particularly strong in a critically important area that facilitates innovation – education in the 25-34 age range. Its high and growing overall levels of post-secondary and post-graduate residents include Business, Science and Technology master’s and doctoral graduates ready to become the next generation of managers and entrepreneurs. The region would benefit from even more post-secondary graduates and postgraduate degree holders (master's and doctorates) as well as initiatives to encourage entry to these programs for even larger numbers of students.

The scale of R&D funding from private sources in the United States is much higher than in Canada, although collaborative private/public sector funding for R&D in the Toronto Region universities is increasing.

Unfortunately, the region performs relatively poorly compared to other regions in government funding for R&D in the sciences, engineering and health related areas, and in private sector R&D. It would benefit from more R&D investment from governments which would lead to its R&D facilities and human resources becoming stronger, and its universities building a base upon which their capacity to train graduate students and attract R&D-intense industries as partners.

HOW WE ARE PERFORMING

These findings will help key decision makers in government, industry and post-secondary education better understand how the Toronto Region can grow and prosper by focusing attention on building a stronger research base that will benefit us all.

The Toronto Region is publishing more and increasing its numbers of licenses, inventions and patents. These commercialization and knowledge transfer mechanisms are tangible proof that the region’s universities are transferring their R&D to the marketplace. But the region is not matching the competition. It is not performing as well as many of its comparator regions in terms of relative impact – where it publishes and how much it commercializes.

WHO WE ARE

IN SUMMARY

The population of the Toronto Region is growing rapidly, fueled by an influx of skilled, educated immigrants from around the world. The region’s economy benefits from diverse industrial sectors outside its traditional manufacturing base (including “fast” companies with strong potential for growth), solid employment levels, superior wages and healthy household income. Its high use of wireless communication is a sign of a technologically-connected and progressive society.

The Toronto Region has a strong foundation – a large and highly-educated population, diverse industries and high employment rates, for instance – upon which it can build to improve its performance. But to compete successfully to become a truly innovative research base will require significantly more sustained efforts – and a collaborative approach between government, industry and the postsecondary education sector.

2008 Annual Toronto Region Innovation Gauge

INTRODUCTION

3

INTRODUCTION The Toronto Region Research Alliance (TRRA) launched the Annual Toronto Region Innovation Gauge (ATRIG) last year provide an accurate diagnosis of the current strengths and weaknesses of the region’s innovation system relative to key international competitor regions.

We believe that an annual analysis of the region’s innovation performance, based on a range of internationally-accepted performance indicators, is helpful to sustain and enhance the Toronto Region’s innovation performance. For the purpose of this report we have used the same definition of innovation adopted

by The Conference Board of Canada, “the ability to turn knowledge into new and improved goods and services.”1 We hope that the Innovation Gauge will become an increasingly comprehensive measure of the region’s comparative innovation performance, and will help decision-makers undertake the changes needed to move the Toronto Region into the top R&D and innovationbased economies in the world.

The format of ATRIG 2007 was an important first step.

In consultation with the ATRIG Advisory Council, we modeled its approach on the Index of the Massachusetts Innovation Economy (MA Index) developed by the Massachusetts Technology Collaborative (MTC).

2008 Annual Toronto Region Innovation Gauge

While the MA Index offered a rigorous and comprehensive framework for measuring innovation performance, we found that the Toronto Region lacked data routinely captured and available in the United States on numerous innovation indicators – for the country as a whole and for the comparative regions in particular. With input from the ATRIG Advisory Council, we addressed these challenges in the 2008 report by selecting comparator regions and indicators more relevant to the Toronto Region. An understanding of the drivers of the economies of these regions and what makes them strong will yield important information and useful models for the Toronto Region.

4

TORONTO REGION PROFILE The Toronto Region, at the western end of Lake Ontario, consists of Durham, Halton, Hamilton, Guelph, Peel, Toronto, Waterloo, Wellington and York. Over seven million people live in the Toronto Region, making it the fourth largest urban area in North America after New York, Los Angeles and Chicago.

The Toronto Region GDP is $328 billion, accounting for 22% of Canada’s GDP. The region has a wide range of industrial sectors with strong employment, including Manufacturing (529,000), Professional and Scientific services (326,000), and Finance, Insurance and Real Estate services (317,000).

The Toronto Region workforce is well-educated, highly-skilled and growing: every year, 75,000 university and college graduates and 47,000 immigrants enter a very skilled workforce of more than 1.8 million.

The region is attractive to immigrants. Forty-five percent of recent immigrants to Canada choose to live in the Toronto Region. In addition, 60% of these newcomers have at least one university degree, which contributes to the region’s highlyeducated workforce.

The Toronto Region is Canada’s largest centre for research and education, and is home to 9 universities, 8 colleges, and 12 research hospitals.

We will continue to adapt the indicators we use for future Innovation Gauge releases as the region continues to build on its capacity to monitor and assess the key elements of the innovation system.

Reports alone, however, will not produce the changes needed to strengthen the region’s innovation performance.

ATRIG is the first step in a broader process of informing, engaging and building consensus among the Toronto Region innovation system stakeholders. Together, this impressive group of innovation stakeholders can help shape the development of effective strategies, policies and programs to address the region’s weaknesses and capitalize on its strengths.

TRRA invites readers to participate in this process and we welcome feedback. Please email us at info@trra.ca

SPECIAL THANKS TRRA is grateful for the assistance and guidance provided by the members of our ATRIG Advisory Council (please see our acknowledgements, on page 34, for a list of members). We look forward to their continued participation and advice as we adapt and enhance ATRIG in future years.

HOW ATRIG SELECTED THIS YEAR’S COMPARATOR REGIONS This report compares the Toronto Region to Illinois, Massachusetts, Michigan, Montreal, North Carolina’s Research Triangle and California’s Silicon Valley.

We selected these comparator regions or states because they are similar in character, size, economic base or other attributes to the Toronto Region, or because they have economies – or attributes which make them strong researchdriven economies – to which we aspire. All have significant R&D and strong innovation indicators, including many that show positive trends over time.

In most cases ATRIG indicators are presented per 100,000 population in order to provide an accurate picture of the scale of the various indicators in the Toronto Region relative to these comparator regions. For more information about the comparator regions, please refer to Appendix 1.

2008 Annual Toronto Region Innovation Gauge

ATRIG brings a Toronto Region voice to the growing chorus of organizations actively working to focus public attention on critical innovation issues and their relationship to our future competitiveness and prosperity.

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COMPARATOR REGIONS The Innovation Gauge compares the Toronto Region’s performance to six regions that are – or have been – successful in innovation: Illinois, Massachusetts, Michigan, Montreal, Research Triangle and Silicon Valley. The comparators were selected based on: population, proximity, industrial make-up, strong manufacturing base, research intensity, and innovation performance.

AT A GLANCE The Annual Toronto Region Innovation Gauge analyzes the region’s innovation performance, based on a range of innovation indicators. It highlights the current strengths and weaknesses of the region’s innovation system relative to selected comparator regions.

© 2008 Toronto Region Research Alliance

INDICATORS ATRIG indicators fall into three broad categories which paint a picture of the Toronto Region’s innovation performance: who we are – a description of the region’s population and economy; what we offer – factors that facilitate innovation; and how we perform – measures of innovative outputs.

IN SUMMARY The Toronto Region has a strong foundation – a large and highly-educated population, diverse industries and high employment rates, for instance – upon which it can build to improve its performance. But to compete successfully to become a truly innovative research base will require significantly more sustained efforts – and a collaborative approach between government, industry and the postsecondary education sector.

TORONTO REGION York Peel Guelph Wellington

2008 Annual Toronto Region Innovation Gauge

Waterloo

6

Halton

HamiltonWentworth

Durham Toronto

WHAT WE OFFER

The population of the Toronto Region is growing rapidly, fueled by an influx of skilled, educated immigrants from around the world. The region’s economy benefits from diverse industrial sectors outside its traditional manufacturing base (including “fast” companies with strong potential for growth), solid employment levels, superior wages and healthy household income.

The Toronto Region has high levels of post-secondary and post-graduate education in the 25-34 age range, with recent Business, Science and Technology graduates poised to become the next generation of managers and entrepreneurs. This needs to be sustained. The scale of private and public R&D funding in the U.S. far outstrips Canada, although collaborative private/public sector funding for R&D in the Toronto Region universities is increasing.

More government R&D investment would strengthen the universities’ R&D facilities and human resources, improve graduate training, making the region more attractive to R&Dintense industries as partners.

80,000 +

average population increase in the region each year

45% of new

immigrants to Canada settle in the Toronto Region Toronto Region

45%

55%

Rest of Canada

Average 14 “fast companies” per year over the last 6 years

11 industrial sectors

above the average North American concentration, more than comparator regions

65%

of workforce 25-34 years of age has a post-secondary degree or diploma Ahead of only one comparator in the number of engineers graduating with a bachelor’s degree

2x increase in NSERC

Collaborative Research & Development project funding (’98-’08), from $5.1 to $10.2 million

Lowest

of all regions in government R&D funding per capita

HOW WE ARE PERFORMING Like the comparators, the Toronto Region is publishing more and increasing its numbers of licenses, inventions and patents. These commercialization and knowledge transfer mechanisms are tangible proof that R&D is being transferred to the marketplace. The region is not performing as well as many of its comparators in terms of absolute numbers of technology transfers or relative impact – where it publishes and how much it commercializes.

29%

in publications, a trend that matches all comparator regions Ahead of just one comparator in average relative impact factors Average Relative Citations, 2000-2006 Silicon Valley Massachusetts Research Triangle Illinois Michigan Toronto Region Montreal

1.846 1.841 1.603 1.511 1.511 1.409 1.296

Improving on total licenses, patents and invention disclosures (’01-’06); however, the highest performing regions produce 4x more than the Toronto Region

2008 Annual Toronto Region Innovation Gauge

WHO WE ARE

7

2008 Annual Toronto Region Innovation Gauge

WHO WE ARE

8

With a population of more than seven million people (Fig. 1), the Toronto Region is the third largest of the comparator regions. It has fewer people than Illinois and Michigan, but a larger population than the other comparator regions. The region’s population growth rate, at almost 2% over the last 10 years (Fig. 2), is healthy, fueled by growing numbers of educated immigrants.

Household income is relatively high, and many people subscribe to wireless services. Its industrial sectors are diverse, and the region fares well in the high technology-related fields.

population, however, is a quarter the size of the Toronto Region. In absolute numbers, the Toronto Region grew three times more – by approximately 140,000 people – than the Research Triangle, which grew by approximately 45,000 people.

The Toronto Region’s net natural increase in population (i.e. births in the region) has remained steady at approximately 40,000 persons per year. As Fig. 4 shows, on balance, the population of the region increases by more than 80,000 persons annually – largely fueled by immigration, (i.e. adding births to immigrant numbers and subtracting migration from out of the region).

THE TORONTO REGION HAS RELATIVELY STRONG POPULATION GROWTH

Indeed, the number of immigrants to the Toronto Region has been more than double that of the Toronto Region’s closest comparator, the Research Triangle, in each year between 2000 and 2006.

As Fig. 3 indicates, the Toronto Region’s closest comparator, the Research Triangle, has a greater annual net migration. The Research Triangle’s

Fig. 1

Population, 2007 12.9

Illinois Michigan

10.1

Toronto Region

7.0 6.4

Massachusetts Montreal

3.7

Silicon Valley

2.6 1.6

Research Triangle 0

2

4

6

8

10

12

14

Persons (millions) Sources: Statistics Canada, Conference Board of Canada, U.S. Census Bureau, California Department of Finance

Fig. 2

Population, Compound Average Annual Growth, 1996-2007 Research Triangle

3.39%

Toronto Region

1.92%

Silicon Valley Montreal

0.82%

Illinois

0.55%

Massachusetts

0.39%

Michigan

0.31% 0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

Compound Average Annual Growth Rate

Sources: Statistics Canada, Conference Board of Canada, U.S. Census Bureau, California Department of Finance

2008 Annual Toronto Region Innovation Gauge

1.04%

9

Fig. 3

Annual Net Migration (International and Domestic), 2000-2006

140 120

Number of Migrants (thousands)

100 80 60 40 20

Toronto Region Montreal

0

Massachusetts Silicon Valley Research Triangle

-20

Michigan Illinois

-40

2000

2001

2002

2003

2004

2005

2006

Sources: Conference Board of Canada, U.S. Census Bureau, California Department of Finance

Fig. 4

Annual Components of Population Change, Toronto Region, 2000-2006 140

131

128

120

Persons (Thousands)

100

100

100 92

60 40 20 Net International Migration

-2 2008 Annual Toronto Region Innovation Gauge

100

80

0

10

93

0

-20

-14

Net Domestic Migration

-17

-20

-17

2003

2004

2005

-26

-40

2000

2001

Source: Conference Board of Canada

2002

2006

Net Natural Increase

MOST IMMIGRANTS ENTER THE REGION AS HIGHLY-EDUCATED WORKERS

Canada, welcoming approximately 400,000 people. This represents approximately. 60,000 more immigrants than the region’s closest comparator, Silicon Valley, and three times more than its Canadian comparator, Montreal.

The Toronto Region has been, and continues to be, a magnet for educated and experienced immigrants. Since 1961, more than a quarter of Ontario’s population (26.8%) has been born outside Canada. This proportion is 33.0% in all city regions, but 43.4% in Toronto.2

This influx of immigrants is particularly good news for the Toronto Region. In the years between 2000 and 2006, the Toronto Region welcomed increasing numbers of highlyeducated and skilled immigrants as Fig. 6 shows. Of these immigrants, 73% are in the labour force (Fig. 6a) and, of this, 88% or approximately 196,000, are employed.

Large numbers of educated immigrants are symptomatic of a national trend. In 1995, 21% of immigrants to Canada had a university degree; in 2000 this percentage had risen to 26%. The percentage of native-born Canadians with university degrees rose at a much slower rate, from 16% to 18% over the same period.3

The positive contribution of educated immigrants to the Toronto Region is corroborated by national studies, which show that a higher percentage of immigrants with postsecondary education are entering the workforce. According to a recent StatsCan study on immigrants to Canada, “in 2007, the largest gains in immigrant employment were among university-educated immigrants of core working age. While employment for immigrants with other levels of education was mostly unchanged, those with university degrees had an estimated gain of 62,000 (+7.0%), all in full time.”6

Results from the 2001 census indicated that immigration has continued to be of growing importance to the region’s population.4 By 2006, of the 636,500 recent core workingage immigrants who arrived in Canada, the lion’s share went to Ontario’s labour market (51.1%), followed by Quebec (19.2%) and British Columbia (15.9%).5 As Fig. 5 shows, between 2001 and 2006, the Toronto Region benefited from almost 45% of the new immigrants to

Fig. 5

Number of Immigrants as a Percentage of the National Number, 2001-2006

45%

40

30

20

15%

10

6%

5%

3%

2%

0%

Toronto Region: 398,980 Montreal: 133,650 Silicon Valley: 341,207 Illinois: 279,358 Massachusetts: 178,329 Michigan: 119,974 Research Triangle: 17,593

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Va lle y Si

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Re gi o

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0

To ro nt o

Sources: Statistics Canada, U.S. Census Bureau 2008 Annual Toronto Region Innovation Gauge

Percentage of National Immigration

50

11

Fig. 6

170

Immigrants to the Toronto Region, Highest Level of Education, Period of Immigration, 1991-2006 180

109

12

140

85

86

100

81

120

59

80

17

20

15

40

36

14

60

26

Number of Immigrants (Thousands)

160

High School Apprenticeship College University

0

1991-1995

1996-2000

2001-2006

Years

Fig. 6a

2006 Labour Force Status of Immigrants Arriving Between 2001-2006

Not in Labour Force

2

73% of immigrants

(221,000) arriving between 2001-2006 are in the labour force. Of this number:

27%

73%

In Labour Force

– 196,000 were employed (88%) – 25,000 were unemployed (12%)

Source: Statistics Canada

2008 Annual Toronto Region Innovation Gauge

WHY ARE POPULATION GROWTH AND IMMIGRATION IMPORTANT?

12

The high rate of population growth in the Toronto Region is widely considered to be a requirement for economic growth, providing human capital and a constant influx of talent. As Dr. Larry Swanson, associate director of the University of Montana’s O’Connor Center for the Rocky Mountain West pointed out, “economic strength follows population strength: population growth means economic growth and diversification; population loss means economic loss or stagnation.”7 Immigrants – particularly the well-educated immigrants who are coming to the Toronto Region – are of particular importance in bolstering labour force growth. Immigrants enrich the Toronto Region with their skills, training and life experiences, augmenting the region’s foundation for innovation. In fact, the Caledon Institute of Social Policy points to immigrants as a counterpoint to the much-debated “brain drain.”8

THE TORONTO REGION IMMIGRANT EMPLOYMENT COUNCIL (TRIEC) Established in September 2003, TRIEC is comprised of employers, labour, occupational regulatory bodies, post-secondary institutions, assessment service providers, community organizations, and all three levels of government.

Its primary goal is to find and implement local solutions that help break down the barriers immigrants face when looking for work in the Toronto Region.

“The Toronto Region continues to attract large numbers of skilled immigrants who comprise virtually all net labour force growth in the region,” says TRIEC director Elizabeth McIsaac. “This offers the local economy a competitive advantage if the skills and knowledge of these workers can be effectively leveraged and integrated.”

Immigrants also add what one researcher calls “knowledge spillover,” the learning and transfer of knowledge between individuals and firms that precedes innovation.

ENCOURAGING IMMIGRATION OF SKILLED AND EDUCATED WORKERS

“Innovations occur when individuals with high degrees of existing creativity or knowledge make new and novel combinations of this knowledge with new insights observed or learned through spillovers,” say Brian Knudsen, Richard Florida, Gary Gates, and Kevin Stolarick in Urban Density, Creativity, and Innovation. They go on to point out that such spillovers occur “when one individual’s creativity is transferred to another individual or firm. These creative spillovers are in part believed to arise due to frequent face-to-face interactions and communication between individuals.”9

• Ontario now has an uncapped number of work permits available to foreign workers. For intracompany transfers, the process is fast and straightforward: transferees can quickly obtain a work permit for up to seven years. (www.cic.investinontario.com/bi) • Ontario’s Provincial Nominee Program, an expedited permanent resident visa program, allows employers to permanently recruit highend research staff and other workers within defined occupations. (www.ontarioimmigration.ca/english/pnp.asp)

Is the Toronto Region taking full advantage of this latent potential?

• The 2007 federal budget created a Foreign Credential Recognition office (which has, however, so far limited itself to giving referrals to appropriate provincial offices).*

Recognition of immigrants’ credentials has been a stumbling block in the past. According to data from Status of Women Canada, just over half of foreign-trained professionals are working in professions or trades three years after immigrating.10 In addition, the human capital of increasing number of immigrants from eastern Europe, south, east and west Asia and Africa who are now arriving (rising from 35% in 1981 to 72% in 2001) “may initially be less transferable due to potential issues regarding language, cultural differences, education quality, and possibly discrimination.”11

• In November 2007, Ottawa announced expanded foreign credential referral services in India and China that offer orientation sessions for potential immigrants.* * The Conference Board of Canada, The Canada Project Progress Report 2007: The Roads Not Travelled: Insights You Can Count On, (Ottawa: The Conference Board, 2008)

EMPLOYMENT IN KEY INDUSTRIAL SECTORS IS STRONG

strong regional focus and expertise in many sectors outside its traditional manufacturing base. Fig. 7 shows that the Toronto Region has a wide range of industrial sectors, and that the majority of industries in the Toronto

The Toronto Region has high levels of employment in key non-manufacturing industrial sectors, largely due to its

Fig. 7

Industry Sectors, by Size, Average Wage, and Relative North American Concentration, Toronto Region, 2006 100,000

Finance & Insurance

70,000

Utilities

Health Care & Social Assistance

80,000

Information & Cultural Industries

Public Administration

Educational Services

Retail Trade

60,000

Construction

50,000

Professional, Scientific & Technical Services

Wholesale Trade Other Services

40,000 Manufacturing

30,000 Transportation and Warehousing

Waste Management & Remediation Service

20,000

Agriculture, Forestry, Fishing & Hunting

10,000

Arts, Entertainment & Recreation

Accommodation & Food Services

0

0.50

0.60

0.70

0.80

0.90

1.00

1.10

Location Quotient Sources: Statistics Canada, U.S. Census Bureau

Real Estate & Rental Leasing

1.20

1.30

1.40

1.50

2008 Annual Toronto Region Innovation Gauge

($) Average Wage

90,000

13

“…what you’re looking at here is really a story of diversity versus one of specialization.”

Region are performing better than in the rest of Canada.

The X-axis of this graph shows its Location Quotient (LQ) – the employment concentration of industry clusters in the Toronto Region compared to the same industry clusters across North America. Industries with a LQ of one are performing at the average level. Those with a score higher than one have a higher competitive advantage. The Fig. 7 also shows that salaries are high in many of the region’s larger and stronger sectors. The relative size of the sphere shows the number of people employed in the sector, and many sectors in the region are quite large.

Fig. 8

– Meric Gertler, Dean of Arts and Science, University of Toronto

The region has high levels of employment in the Manufacturing and Professional, Scientific and Technical sectors as well as in Finance, Insurance and Real Estate sector and compares favorably to Silicon Valley and Massachusetts, in each of these sectors (Fig. 8). This is of particular importance as these regions are strong performers in both R&D and innovation performance.

Industrial Employment, Percentage in Key Sectors, 2007 Professional, Scientific and Technical Services

4.6%

Toronto Region

3.0% 2.9%

Michigan Illinois

4.3%

Montreal

5.1%

Research Triangle

8.2%

Silicon Valley

4.1%

Massachusetts

Manufacturing

7.6%

Toronto Region

6.1%

Michigan

5.2%

Illinois

7.1%

Montreal

3.5%

Research Triangle

6.2%

Silicon Valley

4.3%

Massachusetts

Finance, Insurance and Real Estate Services

4.4%

Toronto Region

2.2%

Michigan Illinois

3.4% 3.4%

Montreal

2.6% 2.6%

Research Triangle Silicon Valley

4.0%

Massachusetts

0

2

4 % of Total Employment in Area

2008 Annual Toronto Region Innovation Gauge

Sources: Statistics Canada, U.S. Census Bureau

14

6

8

EMPLOYMENT OPPORTUNITIES ARE DIVERSE

MANY “FIRMS TO WATCH”

The Toronto Region has a wide range of specializations and many occupations within the working population (Fig. 9). Approximately 75% of these occupations require specialized training and education, indicating the region has a labour force which is “rich” in specialized skills and education.

The Toronto Region has many successful high-tech “firms to watch.” As Fig. 10 shows, the region fares well among its comparators with fastest-growing technology firms in North America between 2001 and 2007.

Fig. 9

While the region pales in comparison to the numbers in Silicon Valley and Massachusetts, it performs well in comparison to other selected regions, consistently out-performing Montreal, Research Triangle, Illinois and Michigan.

Labour Force by Occupation, Toronto Region, 2006 J. Processing, Manufacturing and Utilities 7%

A. Management 11%

I. Primary Industry 1%

H. Trades, Transport and Equipment Operators and Related 13%

B. Business, Finance and Administrative 21%

G. Sales and Service 22%

C. Natural and Applied Sciences and Related 8% D. Health 5%

F. Art, Culture, Recreation and Sport 4%

E. Social Science, Education, Government Service and Religion 8%

Source: Statistics Canada

Fig. 10

Technology “Fast 500 Companies” Annual Average Number, 2001-2007 70

50 40

35

20

14 8

10

8

7 2

Source: Deloitte and Touche

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0

2008 Annual Toronto Region Innovation Gauge

30

Si

Average Number of Companies

62 60

15

Fig. 11

53.6 47.1 34.9 38.9

48.8 50.3

60

49.3 50.5

53.4 56.2

($) Thousands

80

54.4 49.3

73.3 78.8

Median Household Income, Constant 2006 USD, 2000 and 2006

40

2000 2006

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se ar ch Re

To ro n

to

Re gi

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M

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Va lle y lic on Si

on

20

Sources: Statistics Canada, U.S. Census Bureau, U.S. Department of Labor-Bureau of Labor Statistics

WHY IS A DIVERSE ECONOMY IMPORTANT?

WHY IS HOUSEHOLD INCOME IMPORTANT?

Diversity in the Toronto Region industry and multiple employment sectors has contributed to stronger population growth than in areas that are heavily reliant on a manufacturing base. Furthermore, the region’s diverse areas of specialization add economic stability.

Because the Toronto Region is not dependent upon one sector, its economy may not be as vulnerable when one sector is suffering, because others are available to support the economy.

Good household income is a sign of overall economic prosperity and can act as an indicator of innovation.

The Toronto Region ranks high in this category, likely due to its diverse industrial sectors, relatively low unemployment rate, and the consistent growth in its economy since the early 1990s.

Many strong industrial sectors indicate that the Toronto Region is doing an excellent job of maintaining and growing non-manufacturing related industries and supplying the human capital required for these jobs.

2008 Annual Toronto Region Innovation Gauge

HOUSEHOLD INCOME GROWTH IS HEALTHY

16

The Toronto Region’s average household income growth, while lower than in Massachusetts and Silicon Valley, is healthy (see Fig. 11). The Toronto Region’s diverse industrial make-up will likely ensure that the region will continue to fare better than the U.S. comparator regions as the economic downturn in the United States begins to affect America’s overall income growth.

Michigan and Illinois have already shown declines in household income due to the decline of manufacturing in these regions. A more diversified economy has prevented this from happening in the Toronto Region.

WIRELESS SUBSCRIBER RATE IS HIGH ACROSS THE REGION The Toronto Region is keeping up with or is on par with the comparator regions with respect to number of subscribers to wireless communications and services (Fig. 12). Since 2001, however, the region has fallen behind relative to its comparators. In 2001, the Toronto Region had the highest number of subscribers, with a 10% advantage over its closest comparators, Silicon Valley and the Research Triangle. By 2006, the region had fallen to third in this indicator.

WHY IS WIRELESS SUBSCRIPTION IMPORTANT? The Toronto Region’s high number of subscribers to wireless communications indicates a technologicallyconnected and progressive society.

Fig. 12

Suscribers to Wireless Communications and Services, Percentage of Population, 2001 and 2006 100

82

80

79

Percent of Population

80

75

73

68

60 60

59

50

49

47

45

41

46

40

20 2001 2006

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M ic hi

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s oi in Ill

on to

Re gi

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Tr ia ng

se ar ch Re

Si

lic on

Va lle y

0

Sources: FCC, Statistics Canada

THE BOTTOM LINE • Toronto Region has a strong and growing population base • Toronto Region attracts and retains skilled immigrants • Toronto Region has a diverse economy, with strong industrial clusters in key areas • Toronto Region is tech savvy and inter-connected

2008 Annual Toronto Region Innovation Gauge

• The Toronto Region has “fast companies” with highlighted potential for growth

17

2008 Annual Toronto Region Innovation Gauge

WHAT WE OFFER

18

Educated residents and funding for Research & Development (R&D) are essential for innovation.

The Toronto Region has much to offer in these areas.

The region has high and growing overall numbers of residents with post-secondary and post-graduate degrees. In addition, both government and private sector support for R&D in the region has increased, including collaborative R&D delivered by universities and colleges.

EDUCATION

While the region does not perform well in terms of overall numbers of citizens with post-graduate and professional degrees in the total workforce compared to the selected comparators in the U.S., there has been a 2% overall increase in this measure (an increase of more than 17,000 people) since 2001 (Fig. 14). Only Montreal has enjoyed comparable growth. Indeed, the dramatic increase in post-graduate and professional degrees between 2001 and 2006 shows a healthy positive trend that many of the comparators have failed to replicate.

Some of the U.S. comparators experienced a decline in this category, and many showed very small growth.

HIGH AND GROWING LEVELS OF POST-SECONDARY EDUCATION

More Business, Science and Technology master’s and doctorate graduates are ready to become the next generation of managers and professionals.

The Toronto Region is doing well with respect to overall level of education for the age range 25-34 years. These recent college and university graduates represent the “new” workforce.

GOVERNMENT SUPPORT FOR POST-GRADUATE EDUCATION

As Fig. 13 illustrates, the Toronto Region comes first in college or university education in this age range and within the comparator selection. A larger percentage of the Toronto Region’s population has a college or university education than any of the comparator regions in this age range, with more than 65% of the population in 2006 holding at least a college diploma or associate’s degree. This represents an increase from 56% in 2001.

Fig. 13

The Reaching Higher plan, unveiled in the 2005 Ontario Budget, targeted 14,000 new post-graduate spaces school by 2009/10.

It also identified an additional 104 first-year undergraduate medical spaces by 2008/09.

This program was part of the Ontario government’s $6.2 billion investment in post-secondary education. (www.edu.gov.on.ca/eng/tcu/about/annualreport)

65.2

Percent of Population 25-34 years with a Post-Secondary Degree or Diploma, 2001 and 2006

56.8 49.9

53 51.9

53.8 53.3

55.2

56

60

35.2 35.6

41.9 40.8

50

40

2006

Sources: Statistics Canada, U.S. Census Bureau

n ig a

is Ill in o

M ic h

rc h

Tr ia n

gl e

se tts Re se a

le y

M as sa ch u

Si

lic on

Va l

re al on t M

Re gi o

n

30

2008 Annual Toronto Region Innovation Gauge

2001

To ro nt o

% of Population 25-34

60.3

70

19

Fig. 14

Percent of Population Aged 25-34 years with a Post-Graduate and Professional Degree, 2001 and 2006

Percent of Population 25-34

20

18

17

16

14

15

14

13

12

10 10 8

8

8

6

7

6

8

4 2001 2006

ga n

re al

M ic hi

to To ro n

M on t

Re gi on

is Ill i

no

le Tr ia ng

Re

se ar ch

us et ts as sa ch

M

Si

lic on

Va lle y

0

Sources: Conference Board of Canada, U.S. Census Bureau, California Department of Finance, MA Index

2008 Annual Toronto Region Innovation Gauge

As Fig. 15 shows, in the period 2006-2007, the Toronto Region graduated more students in the category “all other university fields” than in business, science and technology. A closer look at the graduations in that period, however, shows that a greater number of postgraduate degrees were awarded in business science and technology as well as in professional degrees in medicalrelated fields and law (Fig. 16). This indicates that the overall education of the population is good at the undergraduate level and that more students are selecting professional post-graduate studies which adds to the talent pool of highly qualified individuals.

This is likely to persist, with higher enrolment levels in post-graduate programs in Toronto Region universities.

20

These individuals are particularly important in light of another important study, which found that in 2001, Ontario managers still had a way to go to catch up with U.S. managers’ education levels. In 1996, 46% of U.S. managers had a university degree, compared to considerably fewer (31%) of Ontario managers. Ontario results for 2001 indicated that although the educational attainment of Ontario managers has increased, the province’s results in 2001 still did not match U.S. results for 1996. A higher percentage of Ontario managers had less than a high school diploma, and fewer Ontario managers had a high school diploma, a bachelor’s degree, or a graduate degree.12

“Cities with larger concentrations of degree holders – measured as a percentage of the local employment base – have, on balance, experienced faster employment growth – 2.0% per annum – than cities with smaller relative concentrations of degree holders – 1.6%. These differences may appear to be small but, due to compound growth, over the 20-year study period a city that grew at 2% would grow by 49%, while a city with a growth rate of 1.6% would grow by a more modest 37%.”

– Desmond Beckstead, W. Mark Brown and Guy Gellatly, Cities and Growth: The Left Brain. Stats Canada, 2008, p. 17.

Fig. 17 shows that the Toronto Region is graduating fewer engineers per 100,000 than comparator regions. There has, however, been a positive upturn in the graduation rate since 2001, with marked increases in undergraduate, master’s and doctorate degrees in engineering.

This rate of increase needs to be sustained and improved in all professional, scientific and technical disciplines to grow the workforce of the future. Even though the Toronto Region graduates fewer engineers, in absolute numbers, than the comparator regions, the number of engineers graduating has been steadily increasing, with 30% more bachelor’s between 2002 and 2007, for instance.

Fig. 15

Percent of Population 25-34 years with a Post-Secondary Degree or Diploma, 2001 and 2006

Business, Science and Technology

21,000

All Other University Fields

26,000

0

5,000

10,00

15,000

20,000

25,000

30,000

Number of Degrees Source: CUDO

Fig. 16

Post-graduate Business, Science and Technology, and Other Educational Degrees Awarded in the Toronto Region 2006-2007 Academic Year

Business, Science and Technology

4,017

All Other University Fields

669

3,460

543

Master’s Degree Doctorate

0

1,000

2,000

3,000

4,000

5,000

Number of Degrees Source: CUDO

Fig. 17

Engineering Degrees Awarded, per 100,000 Population, 2002 and 2007

8 12

12

125 100

8

32 37

50

5

57 76

75

28

88 83 46 40

25

8 24

40 32

21 22

4 3 21 13

41 40

41 45

3 3

3 1 13 8 30 39

3 4 10 12 21 20

Sources: CUDO, American Assoication of Engineering Societies Inc., Montreal Universities

is in o Ill

Re gi on

To ro nt o

re al M on t

n M ic hi ga

ts et as sa ch us

M

lic on Si

Re

se ar ch

Tr ia ng

le

Va lle y

0

2002

2007 Doctorate Master’s Bachelor’s

2008 Annual Toronto Region Innovation Gauge

Number of Degrees per 100,000

150

21

THE TORONTO REGION NEEDS MORE RESIDENTS WITH UNIVERSITY DEGREES, PARTICULARLY POST-GRADUATE DEGREES The high level of residents in the age range 25-34 who have first degrees and diplomas shows that the value of education is recognized in the Toronto Region.

Overall, the Toronto Region has fewer citizens with university degrees than select U.S. comparators. The U.S. has, however, far more post-secondary institutions – 4,000 colleges and universities13 – than Canada, including many private universities giving citizens greater access to higher education. Canadian and US qualifications are not, however, directly comparable as accreditation of institutions is voluntary in the U.S., not regulated by government as it is in Canada. Independent accrediting organizations are approved by the government and define minimum standards of education in the U.S. These organizations then certify whether schools, postsecondary institutions and other education providers’ academic program meet and maintain that standard.14 The entities which conduct accreditation are associations comprised of institutions and academic specialists in specific subjects.15

2008 Annual Toronto Region Innovation Gauge

Furthermore, the region has relatively fewer residents with post-graduate education; i.e., individuals who hold master’s, professional degrees (such as M.B.A. or M.D.) or doctorates. As Michael McKenzie points out in a 2007 StatsCan report, “people who hold doctorates are an important piston in Canada’s labour force engine. They not only represent the highest educational attainment level in a knowledge-based economy, they are also highly skilled industrial researchers and innovators, teachers and professors and scientists who take care of our health as well.”16

22

More people with higher-level degrees would contribute dollars as well as expertise to the Toronto Region economy. The earning power of post-secondary graduates is considerably higher than for those who do not complete university or college. According to StatsCan figures for 2000, the average salary of a Canadian resident was $32,000. For an Ontario resident, it was $36,000. For a Toronto Region resident, it was $42,000. Science and engineering doctorates in Toronto earned about double: $81,450 for doctorates working in the private sector and $83,321 for doctorates working in the public sector, for an average annual income of $82,115 for both sectors.17 Canada’s Institute for Competitiveness & Prosperity corroborates these findings, pointing out that “In both the stock and flow of science and engineering graduates, we trail the U.S. in graduate degrees.”18 “…an emerging consensus is that as the world’s economies become even more sophisticated, highly skilled workers are simply more valuable and earn higher incomes. And the difference in economic rewards received by them and less skilled workers widens. As

emerging economies, like China and India, advance, we can expect that less-skilled workers in the developed economies will fall further behind. There will also be greater competitive pressure on higher skilled workers, as China and India move up the value chain and compete on more sophisticated bases.”

– Institute for Competitiveness and Prosperity, Prosperity, Inequality and Poverty, Sept. 2007, p. 8.

“We find significant interactions between scientists and engineers and the broader cross-section of degree holders located in cities: the latter may be the primary mechanism through which scientists and engineers contribute to the growth process. In short, scientists and engineers – the left brain of cities – matter most for growth when combined with a large and diverse pool of human capital.”

– Desmond Beckstead, W. Mark Brown and Guy Gellatly, Cities and Growth: The Left Brain. Stats Canada, 2008, p. 32.

TORONTO REGION’S FLEXIBLE PART-TIME MASTER’S PROGRAM IN ENGINEERING Toronto’s Advanced Design and Manufacturing Institute (ADMI) is a unique commitment to achieve excellence in graduate engineering education. The Faculties of Engineering and/or Applied Science and the Business Schools of the partnering universities collaborate to deliver a quality master’s degree program in Design and Manufacturing. The program builds on the expertise in manufacturing and design of four of the strongest academic programs available in the province of Ontario, and integrates the elements of business practices and management skills so essential in the competitive engineering marketplace. (www.admicanada.com)

WHY EDUCATION RESOURCES ARE IMPORTANT In the past, the traditional Ontario manufacturing base provided high-paying jobs which typically did not require post-secondary education. Today, blue collar jobs that provide a middle class lifestyle are much less frequently available to the new entrant to the workforce and are on the decline within the working population.

As a recent StatsCan study pointed out, “there has been a transformation of the work force toward workers with higher skill levels, and those cities that are better able to attract these kinds of workers may end up the winners in this new age.”19

There has been a transition from “doing” to “thinking” jobs, and studies confirm that a highly-educated workforce is essential for innovation. As one report completed for the government of Ontario says, “new graduates, who have had the opportunity to participate in the conduct of basic research, enter industry equipped with training, knowledge, networks and expertise. They bring to the firm knowledge of recent scientific research, as well as an ability to solve complex problems, perform research, and develop ideas. The skills developed through their educational experience with advanced instrumentation, techniques and scientific methods are extremely valuable Students also bring with them a set of qualifications, helping set standards for knowledge in an industry.”20

A large number of scientists and engineers in a city can make tremendous contributions to its research, economic growth and technological innovation. They can also forge important synergies with other degreeholders, and drive innovation much more forcefully than the other degree-holders could on their own. As the StatsCan paper Cities and Growth: The Left Brain puts it, “scientists and engineers – the left brain of cities – matter most for growth when combined with a large and diverse pool of human capital.”21

THE BOTTOM LINE • The Toronto Region needs to sustain and grow its numbers of post-secondary graduates at the first degree or diploma level (bachelor’s degrees and college diplomas or certificates) • The Toronto Region needs to be able to translate its current competitive advantage into more master’s and doctorate degrees

2008 Annual Toronto Region Innovation Gauge

• Toronto Region needs to assess barriers to entry for students with respect to graduate degrees. We need to look at whether there are enough graduate positions, whether the system needs to be more flexible and accessible, and whether there should be more interaction with industry

23

RESEARCH & DEVELOPMENT FUNDING

educational resources available at Canadian postsecondary institutions and to train students in essential technical skills required by industry.25

Research & Development (R&D) funding includes support from the private sector, support from the public sector as well as joint support from both, in collaboration with one another. Research and development provides knowledge and technologies for transfer to the market and funding here is important to ensure sufficient supply of these.

The scale of available government assistance and funding for R&D in the U.S. is much higher than in Canada (Fig. 19). Within Canada, Greater Montreal receives more R&D funding per capita than the Toronto Region.

THE DIFFERENCE BETWEEN CANADIAN AND U.S. GOVERNMENT SUPPORT OF PRIVATE SECTOR R&D

Private sector support for R&D in the Toronto Region is increasing. In fact, by international G8 standards, Canada as a whole does well: the private sector funds more than 10% of university research.22

The Canadian and U.S. governments take a significantly different approach to supporting private sector R&D. According to 2004 data, in Canada, government spends about 0.18% of GDP whereas governments in the U.S. spend about 0.26% of GDP on such support. The countries differ in level of support provided relative to the sizes of economies, with the US almost 45% higher, and in the mix of direct versus indirect funding. In Canada, about 84% of the support is in the form of tax credits (indirect), most notably the Scientific Research & Experimental Development (SR&ED) program and the balance (16%) is direct (grants, loans, etc). In the U.S., most support (76%) is in the form of direct grants and similar payments, with the balance (24%) in the form of tax incentives.

Research conducted at universities, whether at a basic level or in partnership with industry is fundamental to the development of a competitive R&D infrastructure and, hence, innovation within Canada.23 As Fig. 18 shows, the Toronto Region is conducting increasing amounts of R&D which involves collaboration between industry and universities. One important measure of this is the growing contribution that the National Sciences and Engineering Research Council (NSERC) Collaborative Research and Development (CRD) Grants program has been making to the Toronto Region.

NSERC is a federal agency that invests in university research and training in the natural sciences and engineering by encouraging Canadian companies to invest in university R&D.24 Its CRD grants program is intended to give companies that operate from a Canadian base access to the unique knowledge, expertise, and

Fig. 18

OECD, OECD Science, Technology and Industry Outlook, 2006

NSERC Collaborative Research and Development Project Expenditures in Toronto Region, 1997-2008 (Constant 2006 CAD) 12

10.0 10

10.3

8.4

24

6.9 7.8

5.8

5.7

6

8.4

6.3

6.0 4 5.1 2

Source: NSERC

00 -0 1 20 01 -0 2 20 02 -0 3 20 03 -0 4 20 04 -0 5 20 05 -0 6 20 06 -0 7 20 07 -0 8

20

99

-0 0

-9 9 19

98 19

97

-9 8

0

19

2008 Annual Toronto Region Innovation Gauge

Millions

8

There is no single strategy that will improve this situation in the Toronto Region. The current range of strategies, including some new initiatives, have the potential to make an impact on and further strengthen the region’s growing ability to attract more research funds to the region’s institutions as well as more research-intensive firms. These include an increasing number of government initiatives aimed at educational institutes and researchintensive firms, as well as mechanisms to indirectly assist in funding private sector research such as federal R&D tax credits.

PROVINCIAL GOVERNMENT SUPPORT FOR R&D AND ADVANCED MANUFACTURING JOBS Ontario will make $150 million available over the next five years to attract new or enhanced biopharmaceutical investments to the province, through its Biopharmaceutical Investment Program (BIP). The provincial government will use these funds to support up to 20% of total eligible project costs. This public sector investment will increase the province’s level of new biopharmaceutical R&D and advanced manufacturing, expand the footprint of local businesses, create new high value jobs for Ontarians, increase “deal flow” within Ontario’s growing biotech cluster, and build capacity through collaborations with public research institutions.

Spending on R&D in both the private and public sectors is low As Fig.19 shows, the Toronto Region ranks poorly and is fifth out of seven in the natural sciences and infrastructure, faring better in social science, and last in health. In addition, in terms of private sector R&D, despite the increasing the amount of collaborative R&D it funds, the fact is clear that the Toronto Region is considerably lower in reported per capita expenditures on R&D than all of the other comparator regions, except Montreal (Fig. 20).

The government is also funding the Strategic Opportunities Program (SOP), a five-year discretionary, non-entitlement grant program that supports strategic, industry-led programs and projects in targeted areas of strength for Ontario including: • Bio-economy and clean technologies • Advanced health technologies, and • Digital media and Information and Communications technologies (ICT).

Fig. 19

(www.mri.gov.on.ca/english/programs/bip/ program.asp, www.mri.gov.on.ca/english/programs/sop/ program.asp)

1,242

2,568

4,258

Federal Government R&D Funding to Research Institutions, Per Capita, 2000-2007, Constant 2006 USD

1,000 Federal Research Health Funding Federal Research Natural Sciences Funding

800

Federal Research Infrastructure Funding

390

422

600

Sources: NSERC, CFI, CIHR, SSHRC, NIH, NSF

40 46

63 74

61 13 35 n

Re gi on

To ro nt o

re al M on t

M ic hi ga

Ill in o

Va lle y lic on Si

M

as sa

ch us

et

Tr ia ng le

ts

0

2008 Annual Toronto Region Innovation Gauge

169 142

254 67 28 25 is

24 66

167

164

121 40

52 88

280

200

238

280

400

Re se ar ch

Dollars

Federal Research Social Funding

25

Fig. 20

R&D expenditure per $1000 USD sales per 100,000 people, 2007 4.28

4.5 4.0 3.5 3.0 2.5 2.0

1.34

1.5

0.83

1.0

0.33

0.5 0

on lic Si

l Va

y le

Re

a se

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n ia Tr

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s as

s hu ac

ts et M

a ig ich

n

0.16 o in Il l

is o nt ro o T

0.09 on gi e R

M

on

0.04 al tre

Source: Standard and Poor’s COMPUSTAT

WHY R&D FUNDING IS IMPORTANT The presence of R&D facilities moves industry “up the food chain,” from branch plants that manufacture goods into central facilities that create goods and wealth.

R&D staff in industry seek and maintain good relationships with universities. This is encouraged by employers and strengthens the link between both groups. Industries’ R&D departments add applicability to university training and add academic intelligence to industry, substantially benefitting both parties.26, 27 R&D facilities in the private sector create opportunities for highly-trained post-secondary graduates. They create high value-add employment for post-secondary graduates trained in the Toronto Region, thereby encouraging them to stay in the region. They also ensure that the Toronto Region can attract highly-educated immigrants and employ them at an appropriate level. In addition, they strengthen innovation within the region by stimulating networks and interactions between and among the academic community and its counterpart in industry.

2008 Annual Toronto Region Innovation Gauge

As Mike Lazaridis, founder, President and co-CEO of Waterloo-based Research in Motion said in his 2004 presentation to the fourth annual Re$earch Money Conference in Ottawa, “if you really want to understand commercialization, all you have to do is attend convocation at your local university ... Armed with cutting edge

26

technology from around the world, the latest tools, the latest techniques and processes learned from their work under the very best researchers, they graduate with much fanfare and go on to build the industry, institutions and society of our country.”28 R&D jobs tend to be highly paid, and are taken by professionals, raising the overall economic base and socioeconomic level of a region.

Post-secondary graduates tend to be comfortable around innovation and the adoption of new ideas and technologies, increasing the overall “innovativeness” of the area.

Government funding for R&D in universities upgrades the supply of innovation by encouraging competition for peer-reviewed R&D funding and interest from venture capitalists.29 Support of R&D within the private sector supports the management talent necessary to commercialize R&D ideas. As highlighted by Roger L. Martin, “technical strengths in science and technology are probably the most important contributors to the quantity and quality of the supply of innovation. Management skills are critical to organizing R&D efforts, for setting priorities, developing strategies, and acquiring resources. Good management skills also provide the pressure to ensure high quality resource allocation decisions among competing priorities for research funding.”30

THE BOTTOM LINE • The Toronto Region needs R&D investment from the federal and provincial governments to strengthen the R&D infrastructure and build a base upon which to train graduate students and attract R&D-intense industries as partners • The Toronto Region needs to attract more R&D-intensive companies • The Toronto Region needs to look at barriers to R&D in the region and in general

2008 Annual Toronto Region Innovation Gauge

HOW WE ARE PERFORMING

27

R&D INDICATORS The Conference Board of Canada report Innovation Overview (2008) states “Innovation is the ability to turn knowledge into new and improved goods and services.”

ATRIG looked at the quantitative measures of the Toronto Region’s commercialization and knowledge transfer mechanisms – the publications, invention disclosures, patent applications, patents granted and licenses. In the Toronto Region our institutions are important as they are the main producers of these outputs and these provide tangible evidence that the region’s R&D is being transferred from the region’s research institutions to the market.

Knowledge transfer in the Toronto Region is improving The Toronto Region is performing well with respect to overall quantity of scientific publications. The number of publications has increased over time (Fig. 21), however, this upward trend is one which is being demonstrated by all comparator regions (Fig. 22). In fact, most of the comparators are publishing more, per 100,000 population, and only Illinois and Michigan trail the Toronto Region.

The impact of Toronto Region publications is low The Toronto Region is publishing more, but the relative impact, as measured by Average Relative Impact Factor (a weighted measure of citations in science and social science journals that demonstrates the importance of a journal to its field) is lower. Montreal is the only comparator region that has a lower relative impact (Fig. 23).

Fig. 21

$205 MILLION IN NEW VENTURE CAPITAL FOR INNOVATIVE, HIGH-GROWTH COMPANIES In June 2008, the Ontario government and leading institutional investors launched the new $205-million Ontario Venture Capital Fund to strengthen the province’s venture capital sector to support growing innovation. TD Capital Private Equity Investors is the fund manager. Other leading intuitional partners include: OMERS Capital Partners, RBC Capital Partners, Manulife Financial, Business Development Bank of Canada, TD Bank Financial Group, and the Government of Ontario.

The Ontario Venture Capital Fund will invest primarily in Ontario-focused venture capital and growth funds. These funds will enable the province’s venture capital sector to better support innovative, high-growth companies in Ontario by making it easier for them to find the investment, expertise and support they need.

Says Rob MacLellan, Chief Investment Officer, TD Bank, “as patient venture capital investors, we're confident the Ontario Venture Capital Fund can not only produce attractive returns but can also have a significant impact on creating a virtuous cycle that will drive incremental investment in world-class Ontario-based technology and innovation over the long term.”34, 35, 36

Number of Scientific Publications by Authors at Toronto Region Universities, 2000-2006

2008 Annual Toronto Region Innovation Gauge

Number of Publications

11,500

28

10,952 10,182

10,500

9,044

9,500

8,871 8,041

8,500

7,810

7,646

7,500

2000 Source: OST

2001

2002

2003

2004

2005

2006

Fig. 22

Number of Scientific Publications per 100,000 Population, 2000-2006 800 Silicon Valley

700 600

Research Triangle

500 400

Massachusetts

300 200

Montreal Toronto Region Illinois Michigan

100 0

2000

2001

2002

2003

2004

2005

2006

Source: OST

Fig. 23

Average Relative Impact Factors (ARIF) of Publications, 2000-2006 1.5 Massachusetts Silicon Valley

1.4

Illinois Michigan

Toronto Region

1.2

Montreal

1.1

2000

2001

2002

2003

2004

2005

2006

Source: OST

2008 Annual Toronto Region Innovation Gauge

ARIF

Research Triangle

1.3

29

Relative citations show the same pattern (Fig. 24). This indicator shows the average number of times papers from Toronto Region academics are referenced by other academics, providing an indication of the relevance of the work as determined by academic peers.

MARS INNOVATION TO ACCELERATE COMMERCIALIZATION MaRS Innovation is one of 11 new federallysupported Centres of Excellence for Commercialization and Research (CECRs) announced in February 2008. MaRS Innovation is a joint venture between the MaRS Centre, University of Toronto and Toronto’s research hospitals to offer global industry a one stop linkage into the Toronto research engine.

The Toronto Region’s relative impact – where we publish and how much we commercialize – is low, but, is increasing.

In terms of the identification, protection and transfer of intellectual property, the total licenses, discoveries, patents and inventions from Toronto Region universities and research hospitals between 2001 and 2006 has almost doubled (Fig. 25). No other comparator region has increased so dramatically. While the Toronto Region performs relatively poorly on technology commercialization (as measured in patents granted and licensing revenue) in comparison to Silicon Valley and Massachusetts, the region’s performance is, however, comparable to Illinois, Michigan, the Research Triangle and Montreal.

Fig. 24

The partnership received $14.9 million in federal CECR funding over five years to accelerate the commercialization of promising research from its member institutions. Joint teams from MaRS Innovation and each institution will work with researchers to identify discoveries that can be used as the basis for new companies or used by existing companies. MaRS Innovation will focus on delivering the best of Toronto’s innovations in a timely, effective and industry focused manner. www.marsdd.com

Average Relative Citations (ARC), 2000-2006 Silicon Valley

1.846

Massachusetts

1.841 1.603

Research Triangle Illinois

1.511

Michigan

1.511

Toronto Region

1.409

Montreal

1.296 1.25

1.35

1.45

1.55

1.65

1.75

1.85

ARC Source: OST

Fig. 25

Total Licenses, Patents (Applications and Issued), and Invention Disclosures, Universities and Hospitals, per 100,000 Population, 2001 Silicon Valley

64

2008 Annual Toronto Region Innovation Gauge

Research Triangle

30

168

132 77

58

Massachusetts

43 13 13 13

Montreal Toronto Region

7 12 8 9 7

Illinois Michigan 0

20

Source: AUTM

2006 2001

40

60

80

100

120

140

160

180

WHY ARE THE OUTPUTS OF R&D IMPORTANT? Transferring research to the market in the form of publication or intellectual property allows universities to realize their potential as economic drivers. Research papers developed in universities that result in patents and licenses translate academic discoveries into innovative approaches and tangible products which eventually make their way to the market.

One study completed in 2006 for the University of Toronto’s Centre for International Studies Program on Globalization and Regional Innovation Systems put together a number of conclusions from various researchers about the importance of this knowledge transfer: • University research is important to local firms not just for the transfer of knowledge generated through the university’s own research activities, but also as a conduit enabling firms to access knowledge from the “global pipelines” of international academic research networks.

R&D indicators encourage collaboration and networking by publicizing work currently underway. As the MIT study also points out, in addition to education, universities also play an important indirect role in serving as a “public space for ongoing local conversations about the future direction of technologies and markets. The importance of the public space role of the university and its contribution to local innovation performance is often underestimated.”33 A large number of patents, publications and licenses indicates not only research excellence, but also innovation capacity, the ability to transfer research to the market.

The number of patents, publications and licenses communicate the status of the Toronto Region’s R&D compared to that of the rest of the world.

The number of disclosures, patents and licenses communicate the relevance of the Toronto Region’s research activities to the market.

• Universities serve as attractors of talent from elsewhere that contributes to the “thickness” of the local labour market.

THE ONTARIO CENTRE OF EXCELLENCE (OCE) CENTRE FOR THE COMMERCIALIZATION OF RESEARCH (CCR)

• Universities often function as “good community players” rather than “ivory towers” insulated from their community. They facilitate local linkages and networks, and serve as “anchors of creativity” that sustain the virtuous cycle of talent attraction and retention.31

The Centre for the Commercialization of Research (CCR), led by The Ontario Centres of Excellence, will help ensure that new technologies developed by Canada’s outstanding research universities reach the global marketplace. Its initial focus will be on commercializing new technology discoveries related to the environment, natural resources and energy, health and related life sciences, and digital media. CCR will also develop technical and managerial talent nationally, to more effectively commercialize technology.38 www.oce-ontario.org

Another study, completed for the Massachusetts Institute of Technology, points out that universities play an important role in helping attract new human, knowledge and financial resources from elsewhere. In addition, “they can help to adapt knowledge originating elsewhere to local conditions. They can help to integrate previously separate areas of technological activity. They can help to unlock and redirect knowledge that is already present in the region but not being put to productive use.”32

THE BOTTOM LINE

• The Toronto Region has the programs and initiatives in place to strengthen its capacity and drivers for commercialization • The Toronto Region’s performance with respect to R&D outputs is relatively weak; the region needs to continue focusing on this area

2008 Annual Toronto Region Innovation Gauge

• The Toronto Region has a strong foundation – a large and highly-educated population, diverse industries and high employment rates – upon which it can build to improve its performance

31

2008 Annual Toronto Region Innovation Gauge

CONCLUSION

32

The Toronto Region has a strong foundation – a large and educated population and diverse industries, among other pillars of strength. Even though the Toronto Region is publishing more, and issuing more patents and licenses, it is important to build on these strengths through more private and public sector investment in R&D. These initiatives will ensure that the Toronto Region starts producing and reaches its potential for innovation.

TORONTO REGION STRENGTHS The Toronto Region is strong in the “feeders” for innovation: • Population growth • Positive immigration • Attraction of skilled and educated immigrants • Strong key industrial sectors including sectors outside manufacturing, which have high levels of employment • Good postsecondary education levels in society and strong growth in level of educational attainment • A growing number of licenses, patents and inventions from its universities and hospitals.

IMPROVEMENTS “IN THE WORKS” The Toronto Region is taking measures to improve some of its weaker areas – graduate education and commercialization: • Large increases in the enrolment numbers of students to graduate programs at the master’s and doctorate level

OPPORTUNITIES FOR IMPROVEMENT • More R&D investment in the Toronto Region from the public and private sectors • Better public recognition for the R&D strengths and other related “attributes” in the region, as well as a better understanding of the strengths we have.

COMING UP IN FUTURE TRRA REPORTS Future TRRA reports will focus in on specific areas of research that indicate how the Toronto Region is doing in innovation in addition to comparing the Toronto Region to others. TRRA will be sharing: • The results of our study on the Toronto Region’s labour force • Our research and initial findings on networks within the advanced manufacturing labour market • A look on the products of innovation in the Toronto Region – influences on and increases in our performance with respect to patents, research papers and licenses • An in-depth look at key areas of immigration in the Toronto Region as well as effectively immigrants are being integrated and engaged • A look at how the Toronto region compares with respect to copyright materials, an aspect of innovation not considered in ATRIG this year.

• Federal initiatives and provincial programs to encourage the discovery process and increase output of innovations from our institutions

2008 Annual Toronto Region Innovation Gauge

• Provincial programs to encourage companies to hire staff in high-value jobs.

33

ATRIG ADVISORY COUNCIL Mr. Michael Benedict Principal, MCB Strategies Inc. Mr. Charles Davis Edward S. Rogers Sr. Research Chair in Media Management and Entrepreneurship Ryerson University Dr. Paul Genest President & CEO Council of Ontario Universities Mr. John Hoicka Senior Research and Policy Advisor Colleges Ontario Ms. Elizabeth McIsaac Executive Director TRIEC Mr. James Milway Executive Director Institute for Competitiveness and Prosperity Martin Prosperity Institute Ms. Avvey Peters Executive Director, Communications & Government Relations Communitech Mr. Shahrokh Shahabi-Azad Senior Economist, Innovation and Corporate Policy Branch, Ministry of Research and Innovation Ms. José Sigouin Research and Information Analysis University of Toronto

2008 Annual Toronto Region Innovation Gauge

Ms. Natasha Tang Kai Senior Advisor, Performance Measurement and Results Ministry of Research and Innovation

34

Mr. John Tennant CEO Canada’s Technology Triangle Inc. Dr. David Wolfe Co-Director, Program on Globalization and Regional Innovation Systems University of Toronto

PRIMARY AUTHOR Dr. Karen Sievewright Director, Research TRRA

RESEARCH ASSISTANTS Bettina Cheung Odila Duru Alex Hunt Richard Liang Michael Wolfe Andrew Wong

2008 Annual Toronto Region Innovation Gauge

APPENDICES & ENDNOTES

35

APPENDIX 1 – SELECTION OF COMPARATOR REGIONS Six regions were chosen against which to compare the Toronto Region’s performance. These regions are – or have been – successful in areas similar to the Toronto Region, and many represent the best in their respective areas of success.

The following criteria were considered when choosing the comparators: Population: While the spread in population of our comparators is quite large (1.6 to 12.9 million), the Toronto Region comes fairly close to the average at 7 million. Regions with too small or too large a population were excluded.

Proximity: Geographically close regions with similar natural attributes were selected as these have similar economic and infrastructural influences.

Industrial make-up: The selected regions have a similar range of industries and employment levels within these industries.

Strong manufacturing base: While the Toronto Region historically has had a very strong manufacturing base, the sector has experienced recent declines. Due to the significance of this industry, certain other regions strong in manufacturing were selected to compare to the Toronto Region.

Research intensity: Research and innovation are key contributors to the new knowledge-based economy. The Toronto Region, therefore, is compared to other research-intensive areas.

2008 Annual Toronto Region Innovation Gauge

Model regions: Regions which present models that the Toronto Region could aspire to become were selected. The comparator regions are all considered to be successful in one aspect or another. For example, Silicon Valley performs very well in certain indicators and, even though it is not realistic that the Toronto Region performs on par or better than this area, it is still useful to see where the Toronto Region ranks in relation to successful regions.

36

COMPARATOR REGIONS Illinois: Illinois has a strong economy and is geographically close to the Toronto Region. These similarities warrant its inclusion in the 2008 report. The state is located just south of Lake Michigan, and has a population of 12.9 million people.46 In 2006, the gross state product in Illinois was $589 billion US dollars. Much of the state’s economic success occurs in Chicago, a major financial and high technology city.47 Chicago has high employment in information technology industries,48 with manufacturing also playing an important, but declining, role in the city’s economy. The city is an important financial centre, and home to three major financial exchanges.

Many large organizations and businesses are headquartered in Chicago, including a number of Fortune 500 companies.

Illinois is a R&D centre and nine universities are located in the state. The University of Chicago and Northwestern University perform extremely well in various school rankings.49

Industry Sectors by Size, Average Wage, and Relative North American Concentration, Illinois, 2006 110,000 100,000

Utilities

Finance & Insurance Professional, Scientific & Technical Services

Information & Cultural Industries

80,000

Wholesale Trade

70,000 Real Estate & Rental Leasing

60,000

Manufacturing

Health Care & Social Assistance

50,000 40,000

Construction

Retail Trade Transportation & Warehousing

30,000 20,000 10,000

Arts, Entertainment & Recreation

Educational Services

Other Services Accommodation & Food Services

0

0.75

0.80

0.85

0.90

0.95

1.00

1.05

Waste Management & Remediation Service

1.10

1.15

1.20

1.25

Location Quotient Sources: Statistics Canada, U.S. Census Bureau

2008 Annual Toronto Region Innovation Gauge

($) Average Wage

90,000

37

Massachusetts: Massachusetts is a successful state, with a gross state product of $338 billion US dollars. At 6.4 million people, it is very similar in size to the Toronto Region.50 Massachusetts has transitioned from a manufacturing economy,51 to one that is a centre of higher education, biotechnology and finance.

Massachusetts is in the northeastern United States. Boston is the major urban centre in the state and is a major component of the Massachusetts economy. The state is a R&D-intensive area, supported by many universities and colleges.

The Greater Boston area has over 40 colleges and universities, a number of which are highly-respected and ranked.

Massachusetts is an ideal comparator for the Toronto Region, as its proximity and population allow for similar conditions. The state is also an important model, having successfully transformed its economy to take advantage of new technologies and research.

Industry Sectors by Size, Average Wage, and Relative North American Concentration, Massachusetts, 2006 110,000

Finance & Insurance

Professional, Scientific & Technical Services

100,000 Utilities

($) Average Wage

90,000

Wholesale Trade

80,000

Management of Companies & Enterprises

Manufacturing

70,000 60,000

Construction

Real Estate & Rental Leasing Information & Cultural Industries

50,000 Other Services

40,000 30,000 20,000

Health Care & Social Assistance

Transportation & Warehousing

Arts, Entertainment & Recreation

Retail Trade

10,000 0

Waste Management & Remediation Service

0.50

0.75

Accommodation & Food Services

1.00

1.25

1.50 Location Quotient

2008 Annual Toronto Region Innovation Gauge

Sources: Statistics Canada, U.S. Census Bureau

38

Educational Services

1.75

2.00

2.25

2.50

Michigan: Similar to Illinois, Michigan is good comparator region. It is close to the Toronto Region and is known for its strong manufacturing base. The state is just east of Lake Michigan, which composes the bulk of its enormous shoreline.52 Michigan’s population is 10.1 million, and its largest city is Detroit, with a population of just over 900 000 people.53, 54 While best known for its automotive industry, the state has diversified lately, partly in response to the decline manufacturing has experienced. The economy now includes information technology and life sciences industries,55 and has increased R&D expenditures in these areas.56, 57 Michigan is home to the Michigan Life Sciences Corridor (a $1 billion biotech initiative),58 and has a number of large research institutions.

Industry Sectors by Size, Average Wage, and Relative North American Concentration, Michigan, 2006 100,000 Finance & Insurance

80,000

Information & Cultural Industries

70,000 60,000

Utilities

Professional, Scientific & Technical Services Management of Companies & Enterprises

Wholesale Trade

Manufacturing

Health Care & Social Assistance

Construction

50,000

Waste Management & Remediation Service

Real Estate & Rental Leasing

40,000 30,000 20,000

Transportation & Warehousing

Arts, Entertainment & Recreation Retail Trade

10,000

Accommodation & Food Services

0

0.60

0.70

0.80

0.90

Other Services

1.00

1.10

1.20

1.30

1.40

1.50

Location Quotient Sources: Statistics Canada, U.S. Census Bureau

2008 Annual Toronto Region Innovation Gauge

($) Average Wage

90,000

39

Montreal: Montreal is the second largest census metropolitan area (CMA) in Canada,39 with a population of just over 3.5 million people. The CMA includes the island of Montreal and a number of densely-populated suburbs.

In 2007, Montreal’s GDP was $123 billion40 and the region has industrial strengths in aerospace, electronics, pharmaceuticals, software engineering, finance and higher education.41 Many research facilities and agencies are located in the Montreal CMA, including the Canadian Space Agency and the National Research Council.42, 43 There are 11 universities and 12 public colleges located in the region, making the region the second-highest ratio of students per capita in North America 44, 45 Montreal conducts and receives significant research and research dollars as is shown in exhibits 19 and 22.

Montreal was selected as the only Canadian comparator in the 2008 Innovation Gauge because of its strong research focus, proximity to the Toronto Region, and its successful economy.

Industry Sectors by Size, Average Wage, and Relative North American Concentration, Montreal, 2006 70,000

Finance & Insurance Professional, Scientific & Technical Services

($) Average Wage

60,000 50,000

Health Care & Social Assistance

Manufacturing

Transportation & Warehousing

Retail Trade Real Estate & Rental and Leasing

40,000

Utilities Information & Cultural Industries

30,000 20,000

Arts, Entertainment & Recreation

Construction Other Services

Wholesale Trade

10,000 0

0.70

0.80

0.90

1.00

1.10

1.20

Location Quotient

2008 Annual Toronto Region Innovation Gauge

Sources: Statistics Canada, U.S. Census Bureau

40

1.30

1.40

1.50

Silicon Valley: Silicon Valley is located in the southern part of the San Francisco Bay Area. The region has a population of 2.6 million people, and is commonly recognized as one of the most successful regions in North America.59 Silicon Valley is a leader in high technology with thousands of related companies operating within its boundaries. The region also has a high number of Fortune 1000 companies.60 Silicon Valley attracts a large number of engineers and venture capital.

There are five universities within Silicon Valley, with Carnegie Melon and Stanford being amongst them. Because of this, and the nature of the businesses and research in Silicon Valley, the population is highly-educated and the region attracts a large amount of public research funding.61 Often the pinnacle in North American innovation, research, and development, Silicon Valley represents a compelling story for the possibilities provided through innovation.

Industry Sectors by Size, Average Wage, and Relative North American Concentration, Silicon Valley, 2006 180,000

Management of Companies & Enterprises

160,000 Information & Cultural Industries

Wholesale Trade

Finance & Insurance

120,000 100,000 80,000

Transportation & Warehousing

Construction Health Care & Social Assistance

Educational Services

60,000

Real Estate & Rental Leasing

40,000 20,000 0

Waste Management & Remediation Service

Other Services Retail Trade

0.50

Professional, Scientific & Technical Services

0.75

Accommodation & Food Services

1.00

1.25

Arts, Entertainment & Recreation

1.50

1.75

2.00

2.25

2.50

2.75

Location Quotient Sources: Statistics Canada, U.S. Census Bureau

2008 Annual Toronto Region Innovation Gauge

($) Average Wage

Manufacturing

140,000

41

Research Triangle: Located in North Carolina, the Research Triangle is made up of three cities – Raleigh, Durham and Chapel Hill – and has a population of 1.6 million people.62 The region consists of numerous high technology businesses and has a highly-educated population.63 The region is home to Research Triangle Park, one of the largest research parks in the United States.64 A growing number of high technology firms have contributed to the region’s growth over the past years.65 IBM, Nortel Networks, and Cisco Systems all have large offices in the Research Triangle.

There are over 10 colleges and universities within the Research Triangle.66 This dense research infrastructure makes the Research Triangle similar to the Toronto Region in many ways, and sets many goals that the Toronto Region should try and emulate in some capacity.

Note: In three cases, entire states were used over municipalities for the U.S. comparators (e.g., Massachusetts instead of Boston) as they were thought to be a more suitable comparison to the Toronto Region because they include both urban and rural areas and due to limitations in the data available at the municipal level.

Industry Sectors by Size, Average Wage, and Relative North American Concentration, Research Triangle, 2006 90,000 Wholesale Trade

80,000

Professional, Scientific & Technical Services

($) Average Wage

Finance & Insurance

70,000

Manufacturing Health Care & Social Assistance

60,000 50,000

Management of Companies & Enterprises

40,000 Real Estate & Rental Leasing

30,000 20,000

Construction

Transportation & Warehousing

Other Services

Retail Trade Accommodation & Food Services

10,000

Educational Services

Waste Management & Remediation Service

0

0.40

0.60

0.80

1.00

1.20

Location Quotient

2008 Annual Toronto Region Innovation Gauge

Sources: Statistics Canada, U.S. Census Bureau

42

1.40

1.60

1.80

APPENDIX 2 – METHODOLOGY/DATA SOURCES DEFINITION OF REGIONS Toronto Region (TR): Unless otherwise stated, the Toronto Region data is calculated by using five Census Metropolitan Areas (CMA): Guelph, Hamilton, Kitchener, Oshawa and Toronto.

Montreal (MTL): Unless otherwise stated, Montreal is defined as the Statistics Canada CMA. Research Triangle (RT): Unless otherwise stated, the RT is defined as the micropolitan area of Raleigh-Carey-Dunn.

Silicon Valley (SV): Unless otherwise stated, SV is defined as the counties Santa Clara and San Mateo.

Illinois (IL): IL refers to the state of Illinois.

Massachusetts (MA): MA refers to the state of Massachusetts.

Michigan (MI): MI refers to the state of Michigan.

Fig. 1 – Population, 2007 The data was found from population surveys from the US Census Bureau, the California Department of Finance, Statistics Canada, and additional data from the Conference Board of Canada.

Sources Silicon Valley: http://www.dof.ca.gov/HTML/DEMOGRAP/ReportsPapers/Estimates/E2/documents/E-2%20Report.xls http://www.dof.ca.gov/HTML/DEMOGRAP/ReportsPapers/Estimates/E6/E6-90-00/documents/E-6_90-00.xls Toronto Region: Conference Board - Population - TR - 1996-2012 - Nov 2007 (private purchased data) *does not include Guelph Montreal: http://cansim2.statcan.ca/cgiwin/cnsmcgi.exe?Lang=E&RootDir=CII/&ResultTemplate=CII/CII___&Array_Pick=1&ArrayId=0510034 U.S. Comparator States: http://www.censU.S..gov/popest/states/tables/NST-EST2007-01.xls http://www.censU.S..gov/popest/metro/files/2007/CSA-EST2007-alldata.csv http://www.censU.S..gov/popest/archives/1990s/ST-99-03.txt

Fig. 2 – Population, Compound Average Annual Growth, 1996-2007 The population data from Figure 1 was used to calculate the compound annual growth rate from 1996-2007. The formula was:

(

Ending Value Beginning Value

1 ( # of years ) -1 )

Sources Silicon Valley: http://www.dof.ca.gov/HTML/DEMOGRAP/ReportsPapers/Estimates/E2/documents/E-2%20Report.xls http://www.dof.ca.gov/HTML/DEMOGRAP/ReportsPapers/Estimates/E6/E6-90-00/documents/E-6_90-00.xls Toronto Region: *does not include Guelph Conference Board - Population - TR - 1996-2012 - Nov 2007 (private purchased data)

2008 Annual Toronto Region Innovation Gauge

CAGR =

43

Montreal: http://cansim2.statcan.ca/cgiwin/cnsmcgi.exe?Lang=E&RootDir=CII/&ResultTemplate=CII/CII___&Array_Pick=1&ArrayId=0510034 U.S. Comparator States: http://www.censU.S..gov/popest/states/tables/NST-EST2007-01.xls http://www.censU.S..gov/popest/metro/files/2007/CSA-EST2007-alldata.csv http://www.censU.S..gov/popest/archives/1990s/ST-99-03.txt

Fig. 3 – Annual Net Migration (International and Domestic), 2000-2006 For the U.S. states and the RT the data was taken from the U.S. intercensal estimates. The data for SV came from the California Department of Finance. Both the Toronto Region data and the Montreal data are from the Conference Board of Canada. For the Toronto Region and Montreal, the net domestic migration was calculated by adding the net interprovincial migration with the net intercity migration. The net migration was calculated by adding the net international migration, the net interprovincial migration, and the net intercity migration.

Sources Toronto Region: Conference Board - Population - TR - 1996-2012 - Nov 2007 (private purchased data) Montreal: Conference Board – Demograhpics – TR, Van, Mtl, Cgy – 1995-2010 (private purchased data) U.S. Comparator States: http://www.censU.S..gov/popest/states/tables/NST-EST2007-01.xls http://www.censU.S..gov/popest/metro/files/2007/CSA-EST2007-alldata.csv http://www.censU.S..gov/popest/archives/1990s/ST-99-03.txt Research Triangle: http://www.censU.S..gov/popest/archives/1990s/co-99-08/99C8_37.txt http://www.censU.S..gov/popest/metro/files/2007/CBSA-EST2007-alldata.csv http://www.censU.S..gov/popest/metro/files/2007/CSA-EST2007-alldata.csv Silicon Valley: http://www.dof.ca.gov/HTML/DEMOGRAP/ReportsPapers/Estimates/E2/documents/E-2%20Report.xls

Fig. 4 – Annual Components of Population Change, Toronto Region 2000-2006 The Toronto Region data is from the Conference Board of Canada. For the Toronto Region, the net domestic migration was calculated by adding the net interprovincial migration with the net intercity migration. The net migration was calculated by adding the net international migration, the net interprovincial migration, and the net intercity migration.

2008 Annual Toronto Region Innovation Gauge

Source

44

Toronto Region: Conference Board - Population - TR - 1996-2012 - Nov 2007 (private purchased data)

Fig. 5 – Number of Immigrants as a Percentage of the National Number, 2001-2006 The number of immigrants in was summed for each of ATRIG Comparitor regions between 2001-2006. This number was then calculated as a percent of the total national number of immigrants.

Sources Toronto Region & Montreal: http://www12.statcan.ca/english/censU.S.06/data/topics/RetrieveProductTable.cfm?Temporal=2006&PID=93716&GID=8 37928&METH=1&APATH=3&PTYPE=88971&THEME=72&AID=&FREE=0&FOCU.S.=&VID=0&GC=99&GK=NA&RL=0&d1= 5&d2=6&d3=0&d4=0 U.S. Comparator States: http://www.dhs.gov/xlibrary/assets/statistics/yearbook/2006/table04.xls Research Triangle & Silicon Valley: http://www.dhs.gov/xlibrary/assets/statistics/yearbook/2006/table05.xls

Fig. 6 – Immigrants to the Toronto Region, Highest Level of Education, Period of Immigration, 1991-2006 The TR data is from Statistics Canada. For the TR, the number of immigrants at different education levels was summed from 1991-2006 at 5 year intervals. They were separated by highest level of reported education, high school, apprenticeship, college, and university, as seen in the charts, and then graphed to show the trend over 3 time periods.

For the year 2006, this chart includes only the immigration numbers from January 2006 to May 16, 2006.

Source Toronto Region: http://www12.statcan.ca/english/censU.S.06/data/topics/RetrieveProductTable.cfm?Temporal=2006&PID=93716&GID=8 37928&METH=1&APATH=3&PTYPE=88971&THEME=72&AID=&FREE=0&FOCU.S.=&VID=0&GC=99&GK=NA&RL=0&d1= 5&d2=6&d3=0&d4=0

Fig. 7 – Industry Sectors by Size, Average Wage and Relative North American Concentration, Toronto Region, 2006 The data was taken from the U.S. Census Bureau and Statistics Canada. To make the NAICS codes comparable across Canada and the United States, NAICS 99 (industry unclassified) was removed for the U.S. comparators, as this data does not exist for the Canadian comparators. Also, the U.S. NAICS code 42 was changed to 41 to match the Canadian NAICS, both of which are for ‘wholesale trade.’

As Statistics Canada does not provide data on the average wage for particular NAICS codes, this was estimated using the following method. The average wage for Montreal and the TR was calculated by summing the number of employees in each North American Occupation Classification (NOC) sub code from each CMA into each major NOC code. Secondly, the average wages of each NOC sub code was used to calculate the average wages for the major NOC codes for each CMA. The average wage for each major NOC code for each NAICS code was then calculated using a weighted average based on the number of employees. Finally, the average wage for each NOC code for each NAICS code was weighted by the number of employees in the corresponding NOC code and then summed.

Sources Toronto Region and Montreal:

http://www12.statcan.ca/english/censU.S.06/data/topics/RetrieveProductTable.cfm?ALEVEL=3&APATH=3&CATNO=97559-XCB2006023&DETAIL=0&DIM=&DS=99&FL=0&FREE=0&GAL=&GC=99&GK=NA&GRP=0&IPS=97-559-XCB2006023 &METH=0&ORDER=&PID=92116&PTYPE=88971&RL=0&S=1&ShowAll=&StartRow=&SUB=&Temporal=2006&Theme=7 4&VID=&VNAMEE=&VNAMEF= Canada: http://www12.statcan.ca/english/censU.S.06/data/highlights/labour/Table602.cfm?Lang=E&T=602&GH=4&SC=1&SO=9 9&O=A United States: http://factfinder.censU.S..gov/servlet/GQRTable?_bm=y&-geo_id=01000U.S.&-ds_name=CB0600A1&-_lang=en

2008 Annual Toronto Region Innovation Gauge

http://cansim2.statcan.ca/cgiwin/cnsmcgi.exe?Lang=E&RootDir=CII/&ResultTemplate=CII/CII___&Array_Pick=1&ArrayId=2020107

45

Research Triangle: http://factfinder.censU.S..gov/servlet/GQRTable?_bm=y&-ds_name=CB0600A1&-geo_id=31000U.S.20380&-_lang=en http://factfinder.censU.S..gov/servlet/GQRTable?_bm=y&-ds_name=CB0600A1&-geo_id=31000U.S.20500&-_lang=en http://factfinder.censU.S..gov/servlet/GQRTable?_bm=y&-ds_name=CB0600A1&-geo_id=31000U.S.39580&-_lang=en Silicon Valley: http://factfinder.censU.S..gov/servlet/GQRTable?_bm=y&-ds_name=CB0600A1&-geo_id=05000U.S.06081&-_lang=en http://factfinder.censU.S..gov/servlet/GQRTable?_bm=y&-ds_name=CB0600A1&-geo_id=05000U.S.06085&-_lang=en Massachusetts: http://factfinder.censU.S..gov/servlet/GQRTable?_bm=y&-ds_name=CB0600A1&-geo_id=04000U.S.25&-_lang=en Michigan: http://factfinder.censU.S..gov/servlet/GQRTable?_bm=y&-ds_name=CB0600A1&-geo_id=04000U.S.26&-_lang=en Illinois: http://factfinder.censU.S..gov/servlet/GQRTable?_bm=y&-ds_name=CB0600A1&-geo_id=04000U.S.17&-_lang=en

Fig. 8 – Industrial Employment, Percentage in Key Sectors, 2007 The data was taken from the U.S. Census Bureau and Statistics Canada. To make the NAICS codes comparable across Canada and the United States, NAICS 99 (industry unclassified) was removed for the U.S. comparators, as this data does not exist for the Canadian comparators. Also, the U.S. NAICS code 42 was changed to 41 to match the Canadian NAICS, both of which are for ‘wholesale trade.’

As Statistics Canada does not provide data on the average wage for particular NAICS codes, this was estimated using the following method. The average wage for Montreal and the TR was calculated by summing the number of employees in each North American Occupation Classification (NOC) sub code from each CMA into each major NOC code. Secondly, the average wages of each NOC sub code was used to calculate the average wages for the major NOC codes for each CMA. The average wage for each major NOC code for each NAICS code was then calculated using a weighted average based on the number of employees. Finally, the average wage for each NOC code for each NAICS code was weighted by the number of employees in the corresponding NOC code and then summed.

Sources Toronto Region and Montreal: http://cansim2.statcan.ca/cgiwin/cnsmcgi.exe?Lang=E&RootDir=CII/&ResultTemplate=CII/CII___&Array_Pick=1&ArrayId=2020107 http://www12.statcan.ca/english/censU.S.06/data/topics/RetrieveProductTable.cfm?ALEVEL=3&APATH=3&CATNO=97559-XCB2006023&DETAIL=0&DIM=&DS=99&FL=0&FREE=0&GAL=&GC=99&GK=NA&GRP=0&IPS=97-559-XCB2006023 &METH=0&ORDER=&PID=92116&PTYPE=88971&RL=0&S=1&ShowAll=&StartRow=&SUB=&Temporal=2006&Theme=7 4&VID=&VNAMEE=&VNAMEF= Canada:

2008 Annual Toronto Region Innovation Gauge

http://www12.statcan.ca/english/censU.S.06/data/highlights/labour/Table602.cfm?Lang=E&T=602&GH=4&SC=1&SO=9 9&O=A

46

United States: http://factfinder.censU.S..gov/servlet/GQRTable?_bm=y&-geo_id=01000U.S.&-ds_name=CB0600A1&-_lang=en Research Triangle: http://factfinder.censU.S..gov/servlet/GQRTable?_bm=y&-ds_name=CB0600A1&-geo_id=31000U.S.20380&-_lang=en http://factfinder.censU.S..gov/servlet/GQRTable?_bm=y&-ds_name=CB0600A1&-geo_id=31000U.S.20500&-_lang=en http://factfinder.censU.S..gov/servlet/GQRTable?_bm=y&-ds_name=CB0600A1&-geo_id=31000U.S.39580&-_lang=en

Silicon Valley: http://factfinder.censU.S..gov/servlet/GQRTable?_bm=y&-ds_name=CB0600A1&-geo_id=05000U.S.06081&-_lang=en http://factfinder.censU.S..gov/servlet/GQRTable?_bm=y&-ds_name=CB0600A1&-geo_id=05000U.S.06085&-_lang=en Massachusetts: http://factfinder.censU.S..gov/servlet/GQRTable?_bm=y&-ds_name=CB0600A1&-geo_id=04000U.S.25&-_lang=en Michigan: http://factfinder.censU.S..gov/servlet/GQRTable?_bm=y&-ds_name=CB0600A1&-geo_id=04000U.S.26&-_lang=en Illinois: http://factfinder.censU.S..gov/servlet/GQRTable?_bm=y&-ds_name=CB0600A1&-geo_id=04000U.S.17&-_lang=en

Fig. 9 – Labour Force by Occupation, Toronto Region, 2006 The data is from Statistics Canada. The minor NOC codes within each major NOC code were summed for each comparator region.

Source http://www12.statcan.ca/english/censU.S.06/data/topics/RetrieveProductTable.cfm?ALEVEL=3&APATH=3&CATNO=97559-XCB2006023&DETAIL=0&DIM=&DS=99&FL=0&FREE=0&GAL=&GC=99&GK=NA&GRP=0&IPS=97-559-XCB2006023 &METH=0&ORDER=&PID=92116&PTYPE=88971&RL=0&S=1&ShowAll=&StartRow=&SUB=&Temporal=2006&Theme=7 4&VID=&VNAMEE=&VNAMEF=

Fig. 10 – Technology “Fast 500 Companies”, Annual Average Number, 2001-2007 The data was taken from the Deloitte and Touche annual list of technology fast 500 companies in North America from 2001 to 2007. The number for each year was added, then divided by 7 to derive the average annual number over the period.

Sources http://www.deloitte.com/dtt/section_node/0,1042,sid%253D56072,00.html Deloitte – Technology Fast 500 – 2001 Deloitte – Technology Fast 500 – 2002 Deloitte – Technology Fast 500 – 2003 Deloitte – Technology Fast 500 – 2004 Deloitte – Technology Fast 500 – 2005 Deloitte – Technology Fast 500 – 2006 Deloitte – Technology Fast 500 – 2007

The data was taken from Statistics Canada, the U.S. Census. Bureau, and the U.S. Department of Labour. The three year median income was found for the TR and all of the Comparators. These numbers were then converted into constant 2005 dollars, which were then converted into 2006 dollars using the GDP/CPI Index. Finally, the TR and Montreal data was converted to U.S. dollars using the Organisation for Economic Development’s (OECD) purchasing power parity (PPP) numbers.

Sources Toronto Region: 2000 Median Income: Statistics Canada - CANSIM 2020411 2006 Median Income: OECD - Purchasing Power Parities Data http://www.oecd.org/document/47/0,3343,en_2649_34347_36202863_1_1_1_1,00.html#ppp

2008 Annual Toronto Region Innovation Gauge

Fig. 11 – Median Household Income, Constant 2006 USD, 2000 and 2006

47

Montreal: 2000 Median Income: Statistics Canada - CANSIM 3800056 2006 Median Income: OECD - Purchasing Power Parities Data http://www.oecd.org/document/47/0,3343,en_2649_34347_36202863_1_1_1_1,00.html#ppp Massachusetts, Illinois and Michigan 2000 Median Income and 2006 Median Income: US Census Bureau - Current Population Survey http://www.census.gov/hhes/www/income/histinc/h08b.html

Silicon Valley: 2000 Median Income: Census 2000- The number was taken off an interactive map for theSanta Clara and San Mateo Counties. Because the information was not available before Census 2000, this number was weighted by population and taken as the median household income for that 3 year average.

Link: http://factfinder.census.gov/servlet/ThematicMapFramesetServlet?_bm=y&-_MapEvent=zoom&-errMsg=&_useSS=N&-_dBy=040&-redoLog=false&-_zoomLevel=10&-tm_name=DEC_2000_SF3_U_M00024&-tm_config=|b=50|l =en|t=403|zf=0.0|ms=thm_def|dw=1.9557697048764706E7|dh=1.4455689123E7|dt=gov.census.aff.domain.map.LSRMap Extent|if=gif|cx=1159354.4733499996|cy=7122022.5|zl=10|pz=10|bo=|bl=|ft=350:349:335:389:388:332:331|fl=403:381:204:380:369:379:368 |g=01000US|ds=DEC_2000_SF3_U|sb=50|tud=false|db=040|mn=9243|mx=82929|cc=1|cm=1|cn=5|cb=|um=Dollars|pr=0| th=DEC_2000_SF3_U_M00024|sf=N|sg=&-PANEL_ID=tm_result&-_pageY=&-_lang=en&-geo_id=01000US&_pageX=&-_mapY=&-_mapX=&-_latitude=&-_pan=&-ds_name=DEC_2000_SF3_U&-_longitude=&-_changeMap=Identi fy#?416,218 2006 Median Household Income: US Census Bureau - American Community Survey http://factfinder.census.gov/servlet/DatasetMainPageServlet?_program=ACS&_submenuId=datasets_2&_lang=en

Research Triangle: 2000 Median Income: Census 2000- The number was taken off an interactive map for the Raleigh-Dunn-Chapel Hill Metropolitan area Because the information was not available before Census 2000, this number was taken as the median household income for that 3 year average.

Link: http://factfinder.census.gov/servlet/ThematicMapFramesetServlet?_bm=y&-_MapEvent=zoom&-errMsg=&_useSS=N&-_dBy=040&-redoLog=false&-_zoomLevel=10&-tm_name=DEC_2000_SF3_U_M00024&-tm_config=|b=50|l =en|t=403|zf=0.0|ms=thm_def|dw=1.9557697048764706E7|dh=1.4455689123E7|dt=gov.census.aff.domain.map.LSRMap Extent|if=gif|cx=1159354.4733499996|cy=7122022.5|zl=10|pz=10|bo=|bl=|ft=350:349:335:389:388:332:331|fl=403:381:204:380:369:379:368 |g=01000US|ds=DEC_2000_SF3_U|sb=50|tud=false|db=040|mn=9243|mx=82929|cc=1|cm=1|cn=5|cb=|um=Dollars|pr=0| th=DEC_2000_SF3_U_M00024|sf=N|sg=&-PANEL_ID=tm_result&-_pageY=&-_lang=en&-geo_id=01000US&_pageX=&-_mapY=&-_mapX=&-_latitude=&-_pan=&-ds_name=DEC_2000_SF3_U&-_longitude=&-_changeMap=Identi fy#?416,218

2008 Annual Toronto Region Innovation Gauge

2006 Median Household Income: US Census Bureau

48

http://factfinder.census.gov/servlet/STTable?_bm=y&-context=st&-qr_name=ACS_2006_EST_G00_S1901&ds_name=ACS_2006_EST_G00_&-CONTEXT=st&-tree_id=306&-keyword=Durham&-redoLog=false&-_caller=geoselect &-geo_id=31000US20380&-format=&-_lang=en http://factfinder.census.gov/servlet/STTable?_bm=y&-context=st&-qr_name=ACS_2006_EST_G00_S1901&ds_name=ACS_2006_EST_G00_&-CONTEXT=st&-tree_id=306&-keyword=Durham&-redoLog=false&-_caller=geoselect &-geo_id=31000US20500&-format=&-_lang=en http://factfinder.census.gov/servlet/STTable?_bm=y&-context=st&-qr_name=ACS_2006_EST_G00_S1901&ds_name=ACS_2006_EST_G00_&-CONTEXT=st&-tree_id=306&-keyword=Durham&-redoLog=false&-_caller=geoselect &-geo_id=31000US39580&-format=&-_lang=en

Fig. 12 – Subscribers to Communications and Services, Percentage of Population, 2001 and 2006 The data is from the Federal Communications Commission (FCC) and Statistics Canada. The population numbers from Fig. 1 were used to calculate percentages.

Sources U.S. Comparator Regions: 2006 FCC Report http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-08-28A1.pdf 2004,5 FCC Report http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-06-142A1.pdf 2002,3 FCC Report http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-04-216A1.pdf 2001 FCC Report; http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-02-179A1.pdf Canada – Toronto Region & Montreal: http://cansim2.statcan.ca/cgiwin/cnsmcgi.pgm?regtkt=&C2Sub=&ARRAYID=2030020&C2DB=&VEC=&LANG=E&SrchVer=&ChunkSize=&SDDSLOC= &ROOTDIR=CII/&RESULTTEMPLATE=CII/CII_PICK&ARRAY_PICK=1&SDDSID=&SDDSDESC= (subscription required)

Fig. 13 – Percent of Population 25-34 Years with a Post-Secondary Degree or Diploma, 2001 and 2006 The TR data is from Statistics Canada’s Education Attainment data and the U.S. Census Bureau American Community Survey. The percentages were calculated using the population numbers from Fig. 1.

Sources U.S. Comparator Regions: http://factfinder.census.gov/servlet/DatasetMainPageServlet?_program=ACS&_submenuId=datasets_2&_lang=enEleva tors B15001. SEX BY AGE BY EDUCATIONAL ATTAINMENT FOR THE POPULATION 18 YEARS AND OVER - Universe: POPULATION 18 YEARS AND OVER B15002. SEX BY EDUCATIONAL ATTAINMENT FOR THE POPULATION 25 YEARS AND OVER - Universe: POPULATION 25 YEARS AND OVER Canada – Toronto Region & Montreal:

Fig. 14 – Percent of Population Aged 25-34 with a Post-Graduate or Professional Degree, 2001 and 2006 The data is from Statistics Canada and the U.S. Census. Bureau. The percentages were calculated using the population numbers from Fig. 1. Professional degrees include medicine, dentistry, veterinary medicine and optometry.

Sources U.S. Comparator Regions: http://factfinder.census.gov/servlet/DatasetMainPageServlet?_program=ACS&_submenuId=datasets_2&_lang=enEleva tors

2008 Annual Toronto Region Innovation Gauge

http://www12.statcan.ca/english/census06/data/topics/RetrieveProductTable.cfm?TPL=RETR&ALEVEL=3&APATH=3&C ATNO=&DETAIL=0&DIM=&DS=99&FL=0&FREE=0&GAL=0&GC=99&GK=NA&GRP=1&IPS=&METH=0&ORDER=1&PID=9 3609&PTYPE=88971&RL=0&S=1&ShowAll=No&StartRow=1&SUB=0&Temporal=2006&Theme=75&VID=0&VNAMEE=&V NAMEF=

49

B15001. SEX BY AGE BY EDUCATIONAL ATTAINMENT FOR THE POPULATION 18 YEARS AND OVER - Universe: POPULATION 18 YEARS AND OVER B15002. SEX BY EDUCATIONAL ATTAINMENT FOR THE POPULATION 25 YEARS AND OVER - Universe: POPULATION 25 YEARS AND OVER Canada – Toronto Region & Montreal: http://www12.statcan.ca/english/census06/data/topics/RetrieveProductTable.cfm?TPL=RETR&ALEVEL=3&APATH=3&C ATNO=&DETAIL=0&DIM=&DS=99&FL=0&FREE=0&GAL=0&GC=99&GK=NA&GRP=1&IPS=&METH=0&ORDER=1&PID=9 3609&PTYPE=88971&RL=0&S=1&ShowAll=No&StartRow=1&SUB=0&Temporal=2006&Theme=75&VID=0&VNAMEE=&V NAMEF=

Fig. 15 – Percent of Population 25-34 Years with a Post-Secondary Degree or Diploma, 2001 and 2006 All of the data was obtained from Common University Data Ontario (CUDO).

Source Toronto Region: http://www.cou.on.ca/_bin/relatedSites/cudo.cfm

Fig. 16 – Business, Science and Technology, and Other Education Degrees Awarded in the Toronto Region, 2006-2007 Academic Year All of the data was obtained from Common University Data Ontario (CUDO).

Source Toronto Region: http://www.cou.on.ca/_bin/relatedSites/cudo.cfm

Fig. 17 – Engineering Degrees Awarded per 100,000 Population, 2002 and 2007 The data for the U.S. comparator regions was obtained from the Engineering Workforce Commission of the American Association of Engineering Societies, Inc. (AAES) in their publication ‘Engineering & Technology Degrees’. The data for the TR is from CUDO, and the data for Montreal was obtained by contacting each University individually and obtaining data. Totals were divided by the population numbers from Fig. 1.

Source U.S. Comparator Regions: “Engineering & Technology Degrees” (publication purchased from the AAES) Toronto Region: CUDO (Common University Data Ontario) http://www.cou.on.ca/_bin/relatedSites/cudo.cfm

2008 Annual Toronto Region Innovation Gauge

Fig. 18 – NSERC Collaborative Research and Development Project Funding in the Toronto Region, 1997-2008 (Constant 2006 CAD)

50

The data was obtained from the Natural Sciences and Engineering Research Council (NSERC) published grant reports and the NSERC searchable database. It was then summed for each year.

Sources Toronto Region 2007: http://www.nserc.gc.ca/about/disclosure_grants/grants_report_oct-dec-07_e.pdf http://www.nserc.gc.ca/about/disclosure_grants/grants_report_july-sept2007_e.pdf http://www.nserc.gc.ca/about/disclosure_grants/grants_reports_apr-july2007_e.pdf http://www.nserc.gc.ca/about/disclosure_grants/grants_report_jan-mar2007_e.pdf

Toronto Region prior to 2007: http://www.nserc.gc.ca/about/stats/2004-2005/en/tables/FF04-05E.xls

Fig. 19 – Federal Government R&D Funding to Research Institutions, per capita, 2000-2007, Constant 2006 USD The data for the TR and Montreal was obtained from NSERC, the Canadian Institute of Health Research (CIHR), the Canadian Foundation for Innovation (CFI) and, the Social Sciences and Humanities Research Council (SSHRC). The data for the US comparators was obtained from the National Science Foundation (NSF) and the National Institutes of Health (NIH). The values were converted to standard 2006 dollars. The data for the TR and Montreal was then converted to 2006 USD using the Consumer Price Index (CPI).

Sources Toronto Region & Montreal: http://www.nserc.gc.ca/about/disclosure_grants/grants_report_oct-dec-07_e.pdf http://www.nserc.gc.ca/about/disclosure_grants/grants_report_july-sept2007_e.pdf http://www.nserc.gc.ca/about/disclosure_grants/grants_reports_apr-july2007_e.pdf http://www.nserc.gc.ca/about/disclosure_grants/grants_report_jan-mar2007_e.pdf http://www.nserc.gc.ca/about/stats/2004-2005/en/tables/FF04-05E.xls http://webapps.cihr-irsc.gc.ca/funding/Search?p_language=E&p_version=CIHR http://www.outil.ost.uqam.ca/CRSH/RechProj.aspx?vLangue=Anglais or http://www.sshrc.ca/web/about/stats/tables_e.asp http://www.innovation.ca/projects/CFIawards100608.xls U.S. Comparator Regions: http://report.nih.gov/award/trends/State_Congressional/StateOverview.cfm http://www.nsf.gov/awardsearch/tab.do?dispatch=4

Fig. 20 – Private R&D expenditure per $1000 USD sales per 100,000 people, 2007 The data was purchased from Standard & Poor’s Compustat. Then total R&D expenditure for each comparator and the Toronto Region was divided into the total sales. This number was then multiplied by 1000 to give the R&D expenditure per $1000 in sales figure. Finally, this number was divided by the total population for each region, and then multiplied by 100 000 which gives the private R&D expenditure per $1000 sales per 100 000 people.

Source www.compustat.com (private purchased data from compustat)

Fig. 21 – Number of Scientific Publications by Authors at Toronto Region Universities, 2000-2006 The data was purchased from the Observatoire des Sciences et des Techniques (OST).

OST - Patents and Publications - TR, MTL, SV, RT, MA, MI, IL - 2000-2006 (private purchased data)

Fig. 22 – Number of Scientific Publications per 100,000 Population, 2000-2006 The data was purchased from the Observatoire des Sciences et des Techniques (OST).

Source OST - Patents and Publications - TR, MTL, SV, RT, MA, MI, IL - 2000-2006 (private purchased data)

2008 Annual Toronto Region Innovation Gauge

Source

51

Fig. 23 – Average Relative Impact Factors (ARIF) of Publications 2000-2006 The data was purchased from the Observatoire des Sciences et des Techniques (OST).

Source OST - Patents and Publications – TR, MTL, SV, RT, MA, MI, IL - 2000-2006 (private purchased data)

Fig. 24 – Average Relative Citations (ARC), 2000-2006 The data was purchased from the Observatoire des Sciences et des Techniques (OST).

Source OST - Patents and Publications - TR, MTL, SV, RT, MA, MI, IL - 2000-2006 (private purchased data)

Fig. 25 – Total Licenses, Patents (Applications and Issued), and Invention Disclosures, Universities and Hospitals per 100 000 Population, 2001 and 2006 The data is from the Association of University Technology Mangers (AUTM) Licensing Survey. The universities and institutions belonging to each region were identified and their data was summed.

Source

2008 Annual Toronto Region Innovation Gauge

2006 Licensing Survey- http://www.autm.net/about/dsp.pubDetail2.cfm?pid=41

52

APPENDIX 3 – SELECTED SECTOR PROFILES

INTRODUCTION The Toronto Region benefits from a diverse economy with expertise and strength in a wide range of economic sectors.

Within this broad range of industries, the Toronto Region is home to numerous world-ranked clusters of R&D. The Boston Consulting Group (BCG) worked with TRRA to determine where the region’s research and development strengths lie. This effort identified over 30 research-intensive clusters in which the Toronto Region has developed a critical mass of research, development and business capacity. The top R&D clusters are defined using six key attributes: specialized labour, anchor companies, leading customers, suppliers and infrastructure, public sector R&D, and supportive public policies.

2008 Annual Toronto Region Innovation Gauge

In this section, we profile two research-intensive clusters – Water Technologies and Risk, Fraud, IT Security & Cryptography – which are both topical and pertinent to the regional economy. Public health issues and growing scientific interest in the environment, coupled with the Toronto Region’s proximity to the Great Lakes, have resulted in a high concentration of water-related research and business activity in the region. The Toronto Region is the second largest financial services centre in North America and also is home to several universities with exceptionally strong computer science, engineering and mathematical expertise and programs. It is not surprising, therefore, that a vibrant Risk, Fraud, IT Security and Cryptography cluster has emerged.

53

COMPUTER FRAUD, RISK, IT SECURITY & CRYPTOGRAPHY IN THE TORONTO REGION THE TORONTO REGION IS….

• The site of a strong Fraud, Risk, IT Security & Cryptography cluster, and which provides important support to the region’s financial services sector (This cluster is the second largest financial centre in North America) • A growing hub of more than 100 companies that provide IT security products and services, including industry leaders such as: Bioscript, Certicom Co., Cisco Systems Canada, Digital Cement, Diversinet, IBM Canada, L-1 Identity Solutions, Lorex technology Inc., McAfee Canada, Microsoft Canada, Open Text Corporation, Pharma Algorithms, Route1 Inc., SAP Canada, Symantec Canada, Teranet,Thomson Reuters, and Visual Defence • The location of a sophisticated customer base that includes major financial institutions (e.g., Royal Bank of Canada, Manulife Financial, and Toronto Stock Exchange), and corporations such as Pitney Bowes, Alcatel-Lucent, Research in Motion, Xerox Canada, and COM DEV • Home to the University of Toronto and the University of Waterloo which are ranked among the top 10 universities in North America to publish articles related to IT security and cryptography

• Producing a growing highly-educated and highly skilled workforce in this field: – 11,200 university graduates (all levels) in computer science, physical science, engineering and mathematics in 2006, 18% more than in 2005 – 2,225 technology graduates from colleges/institutes of technology in 2006, 70% more than in 2005

Growing Number Of Graduates, 2005-2006

4.6% COMPUTER ENGINEERING 11.6% COMPUTER SCIENCE 31.0% MATHEMATICS

“The Toronto Region is home to one of the largest and most productive concentrations of research and development talent in the world, and serves as a portal to all of North America’s major markets and institutions.”

– Dan Fortin, President, IBM Canada Ltd.

Top 10 Publishers (North America) on Computer Fraud, Risk and Security and Cryptography by University from 2000-2007

2008 Annual Toronto Region Innovation Gauge

Institution

54

Number of publications

Harvard University

213

WORLD CLASS INDEPENDENT RESEARCH AND EDUCATION

University of Texas

182

Stanford University

157

University of Washington

132

University of Toronto

116

University of Waterloo

115

– $1.7 million (40% of all NSERC funding in 2006/07) went to the Toronto Region

University of California, Los Angeles

114

Columbia University

113

NSERC Funding* for IT Security and Cryptography, Canada, 2007

University of Maryland

113

University of Wisconsin

113

• Toronto Region universities are a hub of research excellence recognized by the National Science and Engineering Research Council (NSERC):

40%

Source: ISI

Rest of Canada

60%

$1.7M CDN

Toronto Region

* Includes all grant and scholarship programs

University of Waterloo

• Institute for Quantum Computing

– 24 of 41 (59%) Canada Research Chairs and NSERC Researchers in Cryptography

• Canadian Centre of Arts and Technology

– 30 of 98 (31%) Canada Research Chairs and NSERC Researchers in IT Security

• Institute for Computer Research

– 7 of 19 (37%) Canada Research Chairs in Computer Security • Toronto Region produces almost half of all IT security and cryptography publications originating from Canadian universities, and 30% of all citations • Over 40 computer science, engineering and mathematics programs are offered at Toronto Region universities and colleges/institutes

• Centre for Applied Cryptographic Research

• Centre for Computational Mathematics in Industry and Commerce • GigatoNanoelectronics (G2N) Centre • Pattern Analysis and Machine Intelligence (PAMI) University of Toronto

• Fields Institute for Research in Mathematical Sciences • Centre for Applied Power Electronics • Intelligent Transportation Systems (ITS) Centre

• Independent research institutes include: Perimeter Institute for Theoretical Physics and Guelph-Waterloo Physics Institute

• Testbed; Adaptive Technology Resource Centre

“…So just in terms of scale...and focus on computer science, Waterloo stands out, even on a global basis stands out very, very well…There are many years where Waterloo is the university we hired the most people from of any in the world, and Waterloo has always been in the top five every year…”

• Nortel Institute for Telecommunications

– Bill Gates, Founder and Chairman, Microsoft Inc.

• Emerging Communications Technology Institute • Knowledge Media and Design Institute

• Bell University Labs • Ontario Network on the Regional Innovation System McMaster University

• Centre for Emerging Device Technologies • Centre for the Effective Design of Structures Ryerson University

• Rogers Communication Centre • Institute for Innovation and Technology • Management (IITM) University of Ontario Institute of Technology

• Hacker Lab

2008 Annual Toronto Region Innovation Gauge

WORLD CLASS INDEPENDENT RESEARCH AND EDUCATION (CONTINUED)

55

WATER TECHNOLOGIES IN THE TORONTO REGION: AN IMPORTANT AND GROWING CLUSTER THE TORONTO REGION IS…..

• Located on the shores of the Great Lakes – the world’s largest fresh water source

– University of Guelph: Canada Research Chair in Water Security Supply; Guelph Water Management Group; Groundwater Contamination; Integrated Watershed Management

• Home to over 400 companies providing water-related products and services, including globally-recognized companies such as: GE Water & Processes Technologies (Zenon International); Pipeline Inspection Company; Pathogen Detection Systems; Enwave Energy Corporation; Siemens Water; and Veolia Water

– McMaster University: Water Resources and Hydrologic Modeling Laboratory; United Nations University International Network on Water, Environment and Health; Groundwater Contamination; Great Lakes; Water Resource management; Water Resource Public Policy

• A focal point for water-related research in three key areas: drinking water, wastewater and source water

Top Talent at Toronto Region Universities

WORLD-LEADING RESEARCH AND EDUCATION

University of Waterloo

• Toronto Region universities received 30% ($11.4 million) of National Science and Engineering Research Council (NSERC) funding in 2006-07 for research in water-related fields, including: drinking water, waste water and water resource management, and aquatic ecosystems and species.

• Canada Research Chair in Groundwater Remediation

NSERC Funding* for Water Research, Canada, 2007

• Canada Research Chair in Water Quality Protection • Canada Research Chair in Quantitative Hydrogeology • Canada Research Chair in Limnology (study of inland waters) • NSERC Industrial Research Chair in Water Treatment University of Guelph

• Canada Research Chair in Water Management,

Toronto Region

30%

• Canada Research Chair in Water Supply Security

$11.4M

70%

Rest of Canada

• NSERC Industrial Research Chair in Groundwater Contamination in Fractured Media • NSERC/University of Guelph Chair in Urban Systems Environmental Design

* Includes all grant and scholarship programs

McMaster University

• Canada Research Chair in Interfacial Technologies (focus water purification)

• 38% of NSERC Industrial Research Chairs are awarded to Toronto Region researchers

2008 Annual Toronto Region Innovation Gauge

• Home to leading scientists and research programs:

56

– University of Waterloo: National Science and Engineering Research Council Industrial Research Chair in Water Treatment; International Chair in Water; University Consortium for Field Focused Groundwater Contamination Research; Centre for Advancement of Trenchless Technology – University of Toronto: National Science and Engineering Research Council Industrial Research Chair in Drinking Water; Drinking Water Research Group; groundwater contamination;

• Canada Research Chair in Environment and Health Wilfrid Laurier University

• Canada Research Chair in Cold Regions Hydrology • NSERC Northern Research Chair in Present and Past Hydro-ecology of the Mackenzie Basin Deltas, Ryerson University

• Canada Research Chair in Environmental Interfaces and Biofilms University of Ontario Institute of Technology

• Canada Research Chair in Aquatic Toxicology University of Toronto

• NSERC Industrial Research Chair in Drinking Water Research

BREADTH AND DEPTH OF WATER-RELATED RESEARCH IN TORONTO REGION UNIVERSITIES WASTE WATER

DRINKING WATER

SOURCE WATER

Infrastructure and equipment – Wells, Extraction, Water Management and Fluid Handling

New Treatment Technologies to deal with challenging pollutants (e.g. pharmaceuticals, etc)

Software – Pollutant/Contamination

Buried Infrastructure – storage and distribution Maintenance, replacement and new build Advanced Materials – membranes, removal technologies

Modeling and Water Resource Management Wetland Management Watershed Modeling Well Management Transportation Impact – shipping, roadway runoff, etc.

Advanced Materials – membranes, absorption technologies Emission Reduction – GHG and Odour Energy Conservation and Efficiency Sensor / Detector Technology Energy from waste biomass Biotechnology – pollutants, treatments, groundwater remediation 11 Canada Research Chairs

2008 Annual Toronto Region Innovation Gauge

5 NSERC Industrial Research Chairs

57

APPENDIX 4 – LIST OF ACRONYMS AAES

American Association of Engineering Societies

ADMI

Advanced Design and Manufacturing Institute

ATRIG

Annual Toronto Region Innovation Gauge

AUTM

The Association of University Technology Managers

CCR

Centre for the Commercialization of Research

CECRs

Centres of Excellence for Commercialization and Research

CFI

Canada Foundation for Innovation

CIHR

Canadian Institutes of Health Research

CMA

Census Metropolitan Area

CRD

Collaborative Research and Development

CUDO

Common University Data Ontario

FCC

Federal Communications Commission

LC

Location Quotient

MA Index

Index of the Massachusetts Innovation Economy

MTC

Massachusetts Technology Collaborative

NIH

National Institutes of Health

NSERC

Natural Sciences and Engineering Research Council

NSF

National Science Foundation

OCE

Ontario Centres of Excellence

OECD

Organisation for Economic Co-operation and Development

OST

Observatoire des sciences et des technologies

R&D

Research and Development

SBIR

Small Business Innovation on Research

SSHRC

Social Sciences and Humanities Research Council

Stats Canada

Statistics Canada

STTR

Small Business Technology Transfer

TRIEC

Toronto Region Immigrant Employment Council

TRRA

Toronto Region Research Alliance

2008 Annual Toronto Region Innovation Gauge

GEOGRAPHICAL REGIONS

58

TR

Toronto Region

MTL

Montreal

RT

Research Triangle

SV

Silicon Valley

IL

State of Illinois

MA

State of Massachusetts

MI

State of Michigan

1

The Conference Board of Canada, “Innovation Overview,” http://sso.conferenceboard.ca/hcp/overview/innovation-overview.aspx

2

The Institute for Competitiveness and Prosperity, Missing 0pportunities: Ontario’s urban prosperity gap (Toronto: Institute for Competitiveness and Prosperity, 2003), p.26, www.competeprosper.ca/images/uploads/wp03.pdf

3

The Institute for Competitiveness and Prosperity, Prosperity, Inequality and Poverty (Toronto: Institute for Competitiveness and Prosperity, 2007), p.36, www.competeprosper.ca/download.php?file=WP10.pdf

4

See note 2.

5

Statistics Canada, Canada’s Changing Labour Force, 2006 Census (Ottawa: Statistics Canada., 2008), p.30, www12.statcan.ca/english/census06/analysis/labour/pdf/97-559-XIE2006001.pdf

6

Statistics Canada, The Immigrant Labour Force Analysis Series: The Canadian Immigrant Labour Market in 2007.

(Ottawa: Statistics Canada, 2008), p.8, www.statcan.ca/english/freepub/71-606-XIE/71-606-XIE2008003.pdf

7

Larry Swanson, “Montana on the Move: Summary of Statewide Roundtable 2004, March 6,” www.crmw.org/MontanaOnTheMove/data/March_6_Summary.pdf

8

See note 2.

9

Brian Knudsen et al., Urban Density, Creativity, and Innovation, (Creative Class, 2007), p.9, www.creativeclass.com/rfcgdb/articles/Urban_Density_Creativity_and_Innovation.pdf

10

See note 2 at p.27.

11

Garnett Picot and Arthur Sweetman quoted in The Institute for Competitiveness and Prosperity see note 2 at p.37.

12

The Institute for Competitiveness and Prosperity, Reinventing Innovation and Commercialization Policy in Ontario, (Toronto: Institute for Competitiveness and Prosperity, 2004), p.40, http://204.15.35.174/images/uploads/wp06.pdf

13

USA Study Guide, “Choosing a School: Choosing universities, schools, and colleges for international students,” www.usastudyguide.com/choosingschool.htm

14

Ibid.

15

U.S. Department of Education, “USNEI: Accreditation and Quality Assurance,” www.ed.gov/about/offices/list/ous/international/usnei/us/edlite-accreditation.html

16

Michael McKenzie, Science and Engineering PhDs: A Canadian Portrait (Ottawa: Statistics Canada, 2007), p.3, www.statcan.ca/english/research/11-621-MIE/11-621-MIE2007063.pdf

17

Ibid., at p.4.

18

The Institute for Competitiveness and Prosperity, Reinventing Innovation and Commercialization Policy in Ontario (Toronto: Institute for Competitiveness and Prosperity, 2004), p.30, http://204.15.35.174/images/uploads/wp06.pdf

19

Desmond Beckstead, W. Mark Brown and Guy Gellatly, Cities and Growth: The Left Brain of North American Cities: Scientists and Engineers and Urban Growth (Ottawa: Statistics Canada, 2008), p.8, www.statcan.ca/english/research/11-622-MIE/11-622-MIE2008017.pdf

20

David A. Wolfe, Knowledge and Innovation: A Discussion Paper (Ontario, 2006), p.23, www.utoronto.ca/onris/research_review/WorkingPapers/WorkingDOCS/Working06/Wolfe06_Discussion.pdf

21

See note 19 at p.32.

22

Maryann P. Feldman and Ian Stewart, Knowledge transfer and innovation: a review of the policy relevant literature (Ontario, 2006), p.40

23

Ibid., at p.2.

24

Natural Sciences and Engineering Research Council, “About NSERC,” www.nserc.gc.ca/about/about_e.asp

25

Natural Sciences and Engineering Research Council, “Collaborative Research and Development (CRD) Grants,” www.nserc.gc.ca/partners/indust/prog_profile_e.asp?pro=005

26

Alice Lam, “Work Roles and Careers of R&D Scientists in Network Organizations,” Industrial Relations, 44, no. 2 (2005), 242-275, http://papers.ssrn.com/sol3/papers.cfm?abstract_id=684328

2008 Annual Toronto Region Innovation Gauge

ENDNOTES

59

2008 Annual Toronto Region Innovation Gauge

60

27

The National Academies, “Industry-University Research Partnerships: What Are the Limits of Intimacy?,” www7.nationalacademies.org/guirr/Industry_University_Partnerships_Limits.html

28

See note 20 at p.24.

29

Roger L. Martin and James B. Milway, Strengthening management for prosperity (Toronto: Institute for Competitiveness and Prosperity, 2007), p.3, www.competeprosper.ca/images/uploads/ManagementPaper_May07.pdf

30

Ibid., at p.5.

31

Allison Bramwell and David A. Wolfe, “Universities and Regional Economic Development: The Entrepreneurial University of Waterloo” Research Policy (submitted). www.utoronto.ca/progris/pdf_files/UW%20and%20Regional%20Economic%20Development_rev15Feb06.pdf

32

Richard K. Lester, Universities, Innovation, and the Competitiveness of Local Economies: summary report from the local innovation project (Massachusetts: Industrial Performance Center, Massachusetts Institute of Technology, 2005), p.30, http://web.mit.edu/ipc/publications/pdf/05-010.pdf

33

Ibid., at p.3.

34

Ontario Ministry of Research and Innovation, “Investing in the Jobs of the Future: $165-Million Fund To Attract Investment In High-Growth Companies,” www.mri.gov.on.ca/english/news/VCF111407.asp

35

Ontario Ministry of Research and Innovation, “$205 million investment fund to grow jobs of the future: McGuinty Government Partners with Top Investors To Launch Ontario Venture Capital Fund,” www.mri.gov.on.ca/english/news/VClaunch061108.asp

36

“Ontario unveils $205-million venture fund,” The Ottawa Citizen, June 12, 2008. www.canada.com/ottawacitizen/news/bustech/story.html?id=5d015260-9069-447d-9d0e-a5eb5e9709f6

37

U.S. Small Business Administration, “SBIR and STTR Programs and Awards,” www.sba.gov/SBIR/indexsbir-sttr.html

38

Networks of Centres of Excellence, “CCR – Centre for the Commercialization of Research,” www.ncerce.gc.ca/cecrs/ccr_e.htm

39

Statistics Canada, Population and dwelling counts, for census metropolitan areas and census agglomerations, 2006 and 2001 censuses. www12.statcan.ca/english/census06/data/popdwell/Table.cfm?T=201&S=3&O=D&RPP=150

40

Board of Trade of Metropolitan Montreal, “Gross Domestic Product (GDP) 2007,” www.tableaudebordmontreal.com/indicateurs/activiteeconomique/pib.en.html

41

Ministère des Finances Québec. Economic and Financial Profile of Québec 2008 (Québec: Ministère des Finances, 2008), p. 4-5, www.finances.gouv.qc.ca/documents/autres/en/AUTEN_profil2008.pdf

42

Investissement Québec, “Canadian Space Agency”. www.investquebec.com/en/index.aspx?page=1821#1

43

National Research Council Canada, “NRC Biotechnology Research Institute,” www.irb-bri.cnrcnrc.gc.ca/home/index_e.html

44

Ministère des Finances Québec. Economic and Financial Profile of Québec 2006 (Québec: Ministère des Finances, 2006), p.5, www.finances.gouv.qc.ca/documents/Autres/en/pfq_2006.pdf

45

Montreal International, “The College Network.,” www.montrealinternational.com/en/vivre/collegial.aspx

46

TRRA compilation based on U.S. Census, “Annual Population Estimates 2000 to 2007,” www.census.gov/popest/states/NST-ann-est.html

47

The United States Conference of Mayors, “U.S. Metro economies, gross metropolitan product and housing outlook: Key Findings,” www.usmayors.org/metroeconomies/0107/GMPreport_keyfindings.pdf

48

Karen Chapple et al., “Gauging Metropolitan ‘High-Tech’ and ‘I-Tech’ ", Activity Economic Development Quarterly 18, no. 1, (2004), 10-29, http://edq.sagepub.com/cgi/content/abstract/18/1/10?ijkey=50c44cb29d68315499a2aa3771131b328064bf28&keytyp e2=tf_ipsecsha

49

“America’s Best Colleges 2008: National Universities, Top School,” http://colleges.usnews.rankingsandreviews.com/usnews/edu/college/rankings/brief/t1natudoc_brief.php

50

U.S. Census, “State & Country QuickFacts: Massachusetts,” http://quickfacts.census.gov/qfd/states/25000.html

Government of Massachusetts, “Patrick-Murray Administration Highlights Growth In Robotics Sector, Manufacturing,” www.mass.gov/?pageID=elwdpressrelease&L=1&L0=Home&sid=Elwd&b=pressrelease&f=irobot&csid=Elwd

52

U.S. Department of Commerce, “Ocean and Coastal Management in Michigan,” http://coastalmanagement.noaa.gov/mystate/mi.html

53

U.S. Census, “State & Country QuickFacts: Michigan,” http://quickfacts.census.gov/qfd/states/26000.html

54

U.S. Census, “Cities & towns - Places over 100,000: 2000 to 2007,” www.census.gov/popest/cities/SUB-EST2007.html

55

MEDC, “Michigan: High Technology Focus,” http://ref.michigan.org/medc/hitechfocus/

56

Richard J. Bennof, Data Brief: R&D Spending is Highly Concentrated in a Small Number of States. (Arlington: National Science Foundation, 2001) www.nsf.gov/statistics/databrf/nsf01320/sdb01320.htm

57

MEDC, “Growth Industries,” www.michiganadvantage.org/Targeted-Initiatives/Life-Sciences/Default.aspx

58

Ibid.

59

TRRA compilation based on California Department of Finance, “California County Population Estimates and Components of Change by Year — July 1, 2000–2007,” www.dof.ca.gov/HTML/DEMOGRAP/ReportsPapers/Estimates/E2/E-2_2000-07.php

60

“Fortune 1000,” http://money.cnn.com/magazines/fortune/fortune500/2008/full_list/

61

2008 Index of Silicon Valley (San Jose, CA: Joint Venture, Silicon Valley Network, 2008). www.jointventure.org/publicatons/index/2008Index/2008%20Silicon%20Valley%20Index.pdf

62

U.S. Census, “National population datasets,” www.census.gov/popest/datasets.html

63

Research Triangle Region, “Why Research Triangle Region,” www.researchtriangle.org/pages.php?page_id=2

64

“The Research Triangle Park,” www.rtp.org/main/

65

Research Triangle Region, “Why Research Triangle Region,” www.researchtriangle.org/Why%20Research%20Triangle%20Region/

66

Research Triangle Region, “Colleges & Universities,” www.researchtriangle.org/pages.php?page1=52&page2=79&page3=80&page_id=80

2008 Annual Toronto Region Innovation Gauge

51

61

MaRS Centre, Heritage Building 101 College Street, Suite HL30 Toronto, ON M5G 1L7 Tel 416 673 6670 Fax 416 673 6671 Email info@trra.ca Visit us a www.trra.ca Š 2008 Toronto Region Research Alliance