The federal government has hired like gangbusters in recent years, but still needs thousands of in-house technology workers to modernize operations and provide the services that Canadians expect.

Catherine Luelo, the government’s chief information officer (CIO), doesn’t have a firm estimate of how many technology workers the government needs, but the number is big.

“Whether it’s 8,000, 5,000, or 7, 000, it’s thousands. It’s a lot,” she said in a recent interview.

Demand fluctuates with available funding and with the number of people leaving the public service. Luelo said estimates reached as high as 8,000 positions a year ago. Today, her office ballparks that there’s a 30-per-cent shortage among the government’s 21,000 IT jobs – about 7,000 unfilled positions.

All policies and programs today depend on technology. Canadians expect fast and easy digital services, but the government’s old and rickety systems need major overhauls that will also change how government works.

Luelo said the shortage includes skills across the “whole ecosystem” of technology experts who “need to come together to deliver these really hard projects.”

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Speaking tech to power

That’s everything from data engineers, software developers, designers and project managers to experts in cybersecurity, user experience and business process re-engineering.

But these recruits won’t all be permanent hires into the public service.

Luelo said the government will bring in a mix of outsourced and hired talent. The most “pressing matter is aligning the right talent with the right work and implementing innovative ways to upskill existing employees,” she said.

Luelo said departments need contractors with “niche skills” for specific projects. They are also a critical standby workforce as the government struggles to recruit and retain employees during a global talent shortage.

She is working with stakeholders — from unions to the technology industry — to develop a national digital talent strategy. The CIO’s office has set up a  Digital Talent and Leadership office, which is actively recruiting up.

It doesn’t help that the rest of the world is hunting for the very same skills – and pays much more than government to get them.

It will also be a lot more difficult recruiting people now that Finance Minister Chrystia Freeland has told ministers that their departments will have to start cutting if they want money for any new spending in the next federal budget.

Layoffs and hiring slowdowns have finally hit the tech industry, from Shopify and Peloton to Amazon, Microsoft and Meta. But will the supply of workers increase enough to make government wages and working conditions competitive?

But Luelo said the government’s problem is people, not money. She said the $8.7 billion the government spends annually on technology is enough “if we apply the dollars to the right things.”

“If you think about the dollars we have, the things we have to do and the human resources we have to do them, I think the human resources … becomes a constraint in the system versus the dollars,” she said.


With limits on people and money, the government must prioritize its projects, Luelo added. The top three:

  • Add a global case management system to improve passport and immigration services.
  • Overhaul old age security, a phase of the massive modernization of the systems delivering Canada’s benefits programs.
  • Build NextGen, the promised new human resources and pay system to replace the Phoenix pay system that has botched the pay and benefits of thousands of public servants.

Luelo is also trying to find ways to encourage more technical workers to move back and forth between the private and public sectors. She joined the public service after a career in the private sector, most recently as the CIO at Air Canada.

She is always pitching private sector techies to try a “tour of duty” in government for a couple of years. (She wrapped up a speech at a recent global digital summit with the call: “For those interested in coming to work for the federal government, we’re hiring.”)

Government “gets to solve the most complex problems there are to solve, and if I know anything about technical people, they like to do high-impact complex, hairy work. We’ve got it here,” she said in an interview.

Contracting is a black hole of federal spending that a Carleton University research team has been trying to analyze. Last year, it estimated the government spent $15 billion on overall contracting, and $4.6 billion of that was on IT contracts. A parliamentary committee is also doing its own probe.

Critics have long argued the government has never figured out the right balance of using in-house IT talent and hiring outside contractors. Both exploded in recent years.

Amanda Clarke, an associate professor at Carleton University’s school of public policy and administration, is leading the research project. She said much work needs to be done on what kind of work should be done in-house and what should be outsourced.

She said the dependency on contractors has to be broken and will only happen if government has the inhouse skills to manage, oversee and be accountable for projects.

A big problem is that senior managers typically don’t understand technology, so they worry it won’t work, and then default to outsourcing. Outsourcing also helps them shift away accountability so they won’t be blamed if a project derails.

They also default to outsourcing because it’s faster. Recruiting is bogged down with outdated rules and takes months to hire but “you can quickly default to an IBM or Deloitte and have team set up tomorrow,” said Clarke.

“The pattern is outsourcing,” said Clarke. “Part of it is like a learned helplessness among executives. They’ve decided they don’t need to understand technology, it’s someone else’s job and they don’t need to get into the nitty-gritty of procurement.”

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Federal paymasters struggle to rise from Phoenix

Clarke recently wrote a report on reforming IT procurement to bring Canada into line with global best practices. She argued that hiring in-house IT talent is a key first step because without people who know and understand technology, the other management problems, such as procurement, can’t be fixed. Some industry experts argue that in-house hiring is “the silver bullet” to stop the repeated technology failures that are damaging public trust.

“Without in-house IT capacity, it will be impossible to effectively reform other aspects of IT procurement, or to deliver on digital government modernization more broadly,” Clarke wrote.

For years, unions decried what they said was almost an addiction in departments to outsourcing – an army of IT contractors known as the shadow public service. They argue the over-reliance on IT contractors is too costly, locks the government to specific vendors, atrophies skills among in-house technical workers, and erodes transparency and accountability.

There are so many obstacles to recruiting IT talent, especially hiring practices that long predate the era of the cloud, AI and data analysis. On top of pay, recruits are turned off by bilingualism requirements, the months it takes to hire and the lack of a career track for specialists who don’t want management jobs.

This article was produced with support from the Accenture Fellowship on the Future of the Public Service. Read more of Kathryn’s work here.

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Kathryn May
Kathryn May is a reporter and the Accenture fellow on the Future of the Public Service, providing coverage and analysis of the complex issues facing Canada’s federal public service for Policy Options. She has spent 25 years covering the public service – the country’s largest workforce – and has also covered parliamentary affairs and politics for The Ottawa Citizen, Postmedia Network Inc. and iPolitics. She is also the winner of a National Newspaper Award and a Canadian Online Publishing Award. Follow Kathryn on Twitter: @kathryn_may.

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