Canada launched the Pan-Canadian AI Strategy in 2017, the first of its kind in the country, building on the nation’s existing history of AI investments.
Through this strategy, the 2021 federal budget saw a commitment of $185 million in spending on AI over five years.
But is it enough?
A new report analyzing adoption of artificial intelligence technologies has found that, despite early leadership in the space, Canada lags behind many other OECD countries, ranking below the global average in 20th place.
Although Canada laid down important groundwork for AI development through the 1980s and 90’s, the nation has begun to lag in adoption of the tech, according to data gathered by the Toronto Metropolitan University’s think tank, the Dais.
Using Statistics Canada survey data, the Dais found that, at the start if 2022, fewer than 4% of Canadian businesses with five or more employees said they were using AI.
This is in stark contrast to global leaders such as Denmark, where one quarter of businesses use AI, as well as Portugal, Norway, Sweden, and Ireland, and others with higher rates than Canada.
“With all the breathless news coverage and raging debate surrounding artificial intelligence in recent months, it would not be unreasonable to think that the age of AI has already arrived for Canadian businesses,” offers Angus Lockhart, author of the Dais report. “The promise of artificial intelligence has long been its potential to make an economy more productive, increasing wages and living standards for all . . . Unfortunately, Canada lags behind.”
The Dais report found that AI adoption varies widely by industry.
For example, nearly one-in-five utilities companies take advantage of the tech, while only 1% of construction businesses do the same. 13% of finance firms use AI, but only 1% of restaurants do.
The think tank’s analysis also uncovered that larger businesses are adopting AI at much higher rates than small businesses. 20% of companies with 100 or more employees use AI, compared with just 6% of medium-size businesses and 3% of small businesses.
This equates to 60,000 workers in small businesses working with AI, says Lockhart, compared to two million workers in large firms.
“Larger firms have inherent advantages when it comes to AI adoption in the form of access to capital, existing skills, and data infrastructure,” he explains. “Scaling the size of a firm makes the upfront capital cost of adopting AI easier to bear, increases the likelihood a firm will have dedicated ICT workers with the skills to incorporate AI into practice, and increases the amount of data a firm will have to feed into newly implemented AI algorithms. Additionally, the benefits of AI scale more with firm size.”
Two-thirds of Canadian businesses who have not adopted AI say that they have not been able to make a business case for the tech, while others don’t know what AI tools are available on the market.
Lockhart believes that the government should play a bigger role in cultivating an ecosystem of AI adoption in Canada.
“Governments in Canada need to work with their existing partners in the AI ecosystem to develop new and scale up existing programs designed to help business leaders make the case for AI in their workplace,” he posits.
This includes a skills training overhaul, because once firms make a decision to adopt AI, they still need to develop in-house capabilities to use such tools.
In promoting the idea of upskilling, Lockhart points to a “strong relationship between firms that are actively investing in the skills of their existing workers and the adoption of an emerging technology like artificial intelligence.”
Firms should be focused on upskilling both tech and non-tech workers, according to the report.
“Existing ICT workers are best suited to support the implementation of AI systems within their firm,” says Lockhart. “Beyond this, upskilling non-ICT workers is also important to the successful implementation of AI tools. It’s not enough to develop the tools intuitively, they need to be actively used within the business for them to be effective.”