Highlights

Part 1. A statistical profile of the information and communications technologies (ICT) sector
Part 2. A sectoral view of information and communications technologies (ICT) access and use
Part 3. Current issues of the information society
Part 4. Canada and the world

Part 1. A statistical profile of the information and communications technologies (ICT) sector

In 2002, the ICT sector contributed $58.7 billion (in 1997 chained dollars) to Canada’s gross domestic product (GDP), accounting for 7.1% of business sector GDP, and 6.0% of total economy GDP. This was up slightly from the previous year when the sector’s contribution to GDP stood at $57.2 billion.

ICT sector growth over the 1997-2002 period was a remarkable 79.3%, substantially higher than business sector growth and more than four times the growth of the total economy. Following a modest dip in 2001, the ICT sector’s GDP increased by 2.5% in 2002.

ICT sector gross domestic product, Canada, 1997 to 2002

In 2001, the ICT sector accounted for 4.1% of economy-wide employment. This was down slightly from the previous year due to employment cuts in the computer, telephone and other electronic equipment manufacturing industries.

Despite a drop in ICT manufacturing employment over the last year, ICT sector employment increased by 30.7% between 1997 and 2001, more than three times the growth rate of economy-wide employment (9.7%).

ICT sector employment, Canada, 1997 to 2001

Exports of ICT goods and services totaled $25.3 billion and imports $44.8 billion in 2002, falling for the second consecutive year. These represented 5.9% and 11.8% of total exports and imports, respectively.

ICT sector exports and imports, Canada, 1997 to 2002

Canada’s trade deficit was relatively unchanged, at $19.6 billion in 2002. Between 1997 and 2002, the deficit in ICT trade has grown by 16.2%.

Following a substantial increase in 2000, ICT revenues fell to $136.6 billion in 2001, or 5.7% of total industry revenues.

ICT sector revenues, Canada, 1998 to 2001

Investment spending in the ICT sector has been strong, but began to fall in recent years.

ICT sector capital expenditures, Canada, 2000 to 2003

The ICT sector accounts for a substantial share of total private sector research and development (R&D), a share quite disproportionate to its contribution to GDP and employment.

ICT sector research and development, Canada, 1997 to 2003

The Canadian economy is more ICT-intensive than the average for OECD countries when measured in terms of employment and R&D expenditures.

In 2002, some ICT sector industries began to report positive signs of manufacturing activity, or at least had stabilized their levels of production, following several quarters of contraction and downsizing.

The telecommunications services industry invested heavily in digitisation and reached record operating profits ($4.9 billion) by 2002. The wireless sector in particular experienced rapid growth.

Challenged by intense competition from the wireless sector, cable operators have expanded their service offerings by investing in new services, including digital television, high-speed Internet and cable telephony.

The computer systems design and related services industry experienced sharp revenue growth in recent years, climbing to $18.6 billion in 2001. Firms that were diversified generated the highest revenues.

Many firms in the Internet service provider (ISP) industry priced their access services at or near cost in order to remain competitive, and have also diversified their service offerings (e.g. website hosting, design and domain name registrations).

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Part 2. A sectoral view of information and communications technologies (ICT) access and use

Highlights

Nearly 53% of Canadian individuals aged 15 and over had used the Internet in 2000 and a large proportion (42%) had an Internet connection at home.

Canadian households are embracing the Internet in growing numbers. In 2002, 62% contained at least one regular Internet user, up from 29% in 1997. Home-use (51%) surpassed use from work (34%), followed by use from school (23%), other locations (10%), and public libraries (8%).

Household Internet use, by location, Canada, 2002

In 2001, 19% of all households (over 2.2 million) engaged in Internet shopping from various locations, placing 13.4 million orders worth nearly $2 billion. On average, each household placed almost 6 orders and committed $880 to Internet purchases.

Households that use the Internet are more likely to be higher-income families with children, headed by someone less than 35 years of age, and having higher levels of education than non-users. As penetration continues to increase, though, the profile of Internet users starts to resemble that of the population as a whole.

Internet use from home, by household income, Canada, 2002

In 2002, 86% of enterprises used computers, while 76% used the Internet, 32% had a website and 8% actually used the Internet to sell goods or services. Just over 52% of employees in the private sector had access to the Internet.

	Business use of ICTs, Canada, 2002
	Business Internet use, by size, Canada, 2002

The value of orders received over the Internet, albeit small, increases over time. In 2002, it was estimated at $13.3 billion, representing 0.6% of total economic activity. Manufacturers received orders worth about $2 billion, while retailers received $1.7 billion, accounting for 0.3% and 0.5% of their total operating revenues, respectively.

In 2002, nearly all federal and provincial government institutions were using personal computers and the Internet, while 95% had a website. As well, 90% of their employees had access to computers, 88% to e-mail and 85% to the Internet.

Federal and provincial government institutions using ICTs, Canada, 2002

In 2001, 53% of regular home-use households used the Internet to search for government information.

Computerization was widespread and Internet connectivity nearly complete among schools.

In 2002, two-thirds of public sector health care and social assistance employees had direct access to personal computers, while only 51% had direct access to the Internet.

Public sector health and education employees with direct access to the Internet, Canada, 2002

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Part 3. Current issues of the information society

Following exceptional growth in the last half of the 1990s, employment in the computer and telecommunications industries declined nearly 10% between 2001 and 2002, but has since stabilized.

Although the digital divide in Canada is generally closing, differences in ICT penetration between the lowest income deciles and very high income groups persist.

Mobile services were the most competitive of the telecommunications services markets in Canada in 1999, while the local wireline market was the most concentrated.

Nearly one-half (49%) of regular Internet-use households and a majority of regular business users (58%) connected to the Internet with broadband technologies.

Through the 1980s and 1990s, productivity growth in ICT manufacturing was greater than that of core ICT services (i.e., computer services and telecommunications), but ICT services led in terms of GDP and employment growth.

Many cultural industries are still in the process of developing new ICT delivery channels, such as websites and online sales.

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Part 4. Canada and the world

Addressing the digital divide in developing countries is a top priority of the Canadian government.

Canada has taken a leadership role in the Digital Opportunity Task (DOT) Force and the United Nations' ICT Task Force.

Canada actively pursues initiatives aimed at ICT for development issues, such as: ePol-NET for national e-strategies and policy frameworks, Connectivity Africa and the Open Knowledge Network to promote connectivity and local content.

Canada fostered joint work at the working group level between both the DOT Force and the UN ICT Force, resulting in several collaborative initiatives.

Canada established the Action Plan of Quito (ACAPAQ) and the Institute for Connectivity in the Americas to help spread Canada's successful connectivity model and to develop Information Societies in Latin America.

The International Development Research Centre (IDRC) conducts ICTs for development (ICT4D) programming in Africa, Asia and the Americas.

The IDRC's Acacia and Connectivity Africa projects are designed to help developing African nations develop their Information Society and are guided by regional contexts.

In Asia, IDRC programming is geared towards helping the least-developed countries. Regional projects have included provision of Internet access, distance education, and rural and agricultural connectivity projects.