Earlier quoted context omitted.
American firms tend to have much higher quality corporate management than their Canadian counterparts.[1] To be profitable at FAAMG salaries requires leveraging your engineers to achieve very high levels of productivity and execution. That's generally not possible without management that consistently adheres to best practices. [1] https://pubs.aeaweb.org/doi/pdfplus/10.1257/jep.24.1.203
I think a bigger issue is the lack of venture capital. It's significantly harder to to raise the multi-million seed rounds needed to sustain Google/Amazon salary in Waterloo/Toronto
When I was at Google, I learned from an internal pay comparison spreadsheet that a person in the same job at the same level is paid much worse in Waterloo (and in the UK as well) compared to SV / NYC, and the reason cited was "cost of labor" or some such fancy term which essentially meant "we want to pay as little as possible, so a little bit more than our competitors". So ultimately, it boils down to "prevailing wages" in Canada (and the UK).
The first company to offer SV level wages in Canada / UK will see a deluge of high quality applicants who want to stay in those locations for whatever reasons. I wonder why no one has tried that yet.