By Anne Patterson and Erhan Baydar

October 8, 2026

Canada cannot make good decisions about skills, immigration, technology investment, or productivity if it does not have a clear picture of where digital work is actually happening. And, increasingly, it is happening far beyond the traditional technology sector.

The Information and Communications Technology Council (ICTC) estimates roughly one in eight Canadian workers is now part of the digital economy. As digital technologies reshape work, how we define and measure their contribution has become an important policy question for Canada’s productivity, innovation, and economic growth.

For decades, the digital economy was associated with telecommunications, software, computing, and digital services. Those foundations remain essential, but they no longer reflect the growing digital capabilities across every major industry of the Canadian economy.

Software developers are working in banking and energy; retail relies on automation and sensors for activities from self-checkout to warehouse automation and inventory tracking; agriculture, healthcare, finance and professional services are all becoming more digitally intensive.

Today’s reality is that data, automation, and connected systems increasingly shape how businesses and workers across the broader economy operate and compete.

Our understanding of the digital economy needs to reflect that reality. Otherwise, policies intended to strengthen productivity and prepare the workforce risk overlooking the places where transformation and disruption are happening. In other words, a  definition confined to technology industries misses specialized digital work elsewhere.

But including everyone who uses a computer tells us little about the capabilities that distinguish digital production and adoption. The meaningful question is how central digital technology is to the work being performed.

Getting that boundary wrong has consequences.

Define the digital economy too narrowly and we can miss emerging skills needs and digital capabilities in industries such as healthcare, professional services, and construction. Define it too broadly and routine technology use becomes indistinguishable from specialized digital work.

Either way, skills investments, immigration planning, and economic development policy risk being built on an incomplete picture of where Canada actually needs people and capabilities.

In Defining Canada’s Digital Economy: A New Framework for Understanding Digital Work and Economic Participation, the ICTC establishes a framework for Canada’s digital economy that combines two perspectives: the occupations through which people perform digital work, and the industries that produce or deliver digital goods, services, content, and infrastructure.

The ICTC looks at digital work as a spectrum based on how central digital technology is to doing a job.

At one end are core digital roles, including software developers, cybersecurity specialists, and data scientists, whereby creating or managing digital systems is the work itself. Digitally enabled roles are jobs that have been fundamentally reshaped by digital tools, while digitally adjacent roles help operate or support the infrastructure on which those systems depend. At the other end of the spectrum, digitally intensive roles are occupations where advanced digital capabilities have become a significant part of how the work is performed. This helps distinguish specialized digital work from the routine use of technology that is now common across most jobs.

The value of this approach is that it captures digital transformation wherever it is happening, not only inside technology companies. A software developer at a bank, an engineer who builds digital models and simulations, and a specialist who supports network infrastructure are all part of Canada’s digital economy.

Define the digital economy too narrowly and we can miss emerging skills needs and digital capabilities in industries such as healthcare, professional services, and construction. Define it too broadly and routine technology use becomes indistinguishable from specialized digital work.

Looking at the nature of the work — rather than just at industry boundaries or job titles — gives Canada a clearer picture of where digital capabilities are taking root across the economy.

Using this approach, ICTC finds that there are approximately 2.7 million workers within Canada’s digital economy as of June 2026—12.7 per cent of the national workforce, or roughly one in eight workers. About 2.5 million work in digital occupations across industries, while approximately 200,000 more work in digital industries in occupations that are not themselves classified as digital.

For Canadians, how we define and measure the digital economy can have real-world consequences: it can influence which programs colleges and universities choose to expand, what kinds of training governments support, how immigration priorities are set, and whether workers can identify realistic pathways into growing roles.

Better measurement can also show whether new opportunities are reaching different regions and groups of workers, or becoming concentrated in particular places and populations.

This is especially important at a time when technology, talent, infrastructure, and industrial capacity are increasingly interconnected. Canada is competing not just to give businesses access to AI, automation, and advanced digital systems, but on how effectively firms can put those technologies to productive use through a workforce has the skills to use them.

Canada is investing heavily in technology in the hope that it will make businesses more efficient, innovative, and competitive. But adoption alone tells us very little about the economic payoff.

AI is a good example: giving firms access to new tools is one thing; having the people, skills, and processes to use them effectively is another. The rapid pace of digital transformation across industries requires a consistent way to connect technology adoption with the workforce, skills, investment, labour demand, and economic outcomes around it.

With a common definition, Canada can better assess where digital capability is translating into productivity gains, where progress is lagging, and what may be holding it back. It can also distinguish between growth in digital industries themselves and the spread of digital capability throughout the wider economy.

This also allows governments to ask better questions about public investment. Where are new technologies taking root? Which industries face difficulty finding the people needed to use them? Are technology investments accompanied by stronger productivity and workforce outcomes? Are skills shortages, infrastructure gaps or low adoption preventing businesses from realizing their potential?

Better measurement provides a stronger basis for answering these questions and adjusting policy over time.

The policy implications are practical. Governments need consistent occupational and industry boundaries where comparability matters, alongside timely and disaggregated labour market information that shows where pressures and opportunities are emerging.

That evidence can help policymakers see where digital adoption is accelerating, where skills or infrastructure gaps may be holding it back, and which sectors or regions may need different kinds of support. It also provides a stronger basis for assessing whether technology, workforce, and economic development policies are producing the outcomes they were designed to achieve.

None of this means replacing Canada’s existing official measures of digital output and transactions. An occupational and skills perspective complements them. Different measures answer different questions. What a common analytical foundation provides is a way for governments, educators, employers, and researchers to start from the same picture when they are making decisions about people, skills, and economic change.

Getting the definition right will not, by itself, raise Canada’s productivity or solve its skills challenges. But without a reliable way to see where digital capability resides, governments cannot confidently know where shortages are emerging, where technology investment is paying off, which regions are gaining ground, or which workers risk being left behind.

Canada cannot anticipate every technological breakthrough or shift in global competition. But it can strengthen the information it uses to respond. Better measurement is part of the economic infrastructure Canada needs to make better choices about skills, investment, productivity, and growth.

Read ICTC’s full paper, Defining Canada’s Digital Economy: A New Framework for Understanding Digital Work and Economic Participation, here.

Anne Patterson is ICTC’s Chief Research & Communications Officer.

Erhan Baydar is ICTC’s Senior Economist.