My research team at the Martin Prosperity Institute just released a new report on Toronto in the Creative Age. Several things really stand out.
First, Toronto is still coming into its own as a major North American metro. U.S. metros in the Northeast and Midwest had significant expansion a whole lot earlier, but Toronto has seen substantial growth since the 1950s, sort of like a Sunbelt metro. Since then, it has transformed from a sleepy metro into a large and rapidly growing one, fueled by massive immigration and growing across almost every knowledge and creative industry.
Second, Toronto performs extremely well – compared to its benchmark peers – on two of the 3Ts of economic development (talent and tolerance), ranking third in talent and fifth in tolerance (see the table above).
But it performs poorly on the first T – technology, ranking 11th, or last – among its North American peers. Toronto actually did fairly well on our measure of high-tech industry, scoring fourth behind only Los Angeles, New York, and Seattle based on our North American Tech-Pole Index which was adapted from the Milken Institute’s Tech-Pole Index. The MPI research shows that patents in particular are a trouble spot. Not only did Toronto rank third to last in patents – ahead of only Montreal and Vancouver – it also had the lowest score on patent growth, with the region filing 8.3 percent fewer patents in 2005 than in 2000. And it’s not due to a lack of high-tech workers – Toronto ranked fourth of its 11 peers on the North American Tech-Pole Index.
Toronto should be proud of its strengths in talent and tolerance but it also needs to address its weakness in technology and innovation. One way to do that is to leverage the strengths of surrounding areas like Waterloo, home to RIM, Ottawa and Rochester, home to a considerable tech cluster, and Montreal, home to Cirque de Soleil and aerospace, software, and video game firms. Toronto can take the lead in building and capitalizing on the strength of “Tor-Buff-Loo-Mont-Owa” mega-region by strengthening the physical and institutional connections across the mega-region. The mega-region does not currently offer the seamless connections between cities found in “Bos-Wash” or greater Tokyo. But faster rail connections and more seamless border crossings would increase the scale and market size of the mega-region while increasing the velocity of moving people, goods, and ideas across it.
