Amazon Plans Vancouver Expansion Where Talent Is Cheap and Smart

Amazon.com Inc. expects to nearly triple its workforce in Vancouver, where software engineers are cheap, smart and plentiful.

The online retail giant plans to occupy a bunker-like former Canada Post mailing center thats being redeveloped into a new 680,000 square-foot office to house 8,000 jobs by 2023, Jesse Dougherty, a vice president and Vancouver site lead at Amazon, said by phone. Currently, the company has 2,700 full-time employees at its city hub. It also plans to add 500 jobs in Toronto, according to a statement released Monday.

A weak loonie, lower wages and a steady flow of graduates make Canada an attractive place to expand for tech companies whose largest expense is labor.

The average wage of a software developer in Vancouver last year was $92,726, compared to $141,785 in San Francisco or $128,067 in Amazons hometown of Seattle, according to a July report by real estate firm CBRE Group Inc. Once rental costs are folded in, the cost of running a 500-employee operation in the Canadian city is half that of a similar-sized operation in the Bay Area, it found.

Vancouver also had the fastest-growing tech labor pool of 50 markets surveyed in the U.S. and Canada by CBRE, while the quality of its talent based on academic degrees and work experience ranked among the top 10, the study found.

The expansion positions the company to become one of the citys biggest employers: Vancouver-based telecommunications giant Telus Corp. has about 8,000 staff in the province, according to Business In Vancouver.