Data For Business’ is an effort of the Langley Chamber, in partnership with the Canadian Chamber, to bring our members reports, stats and analysis on economic and business data to help inform business and investment decisions. Read our latest update below:
LANGLEY – The Canadian Chamber of Commerce’s Business Data Lab (BDL) has released its latest report highlighting the new reality for small businesses in Canada’s post-pandemic retail landscape, which has been beset by shifting consumer behaviours.
The report, entitled, A Portrait of Small Business in Canada: Adaption, Agility, All At Once, explores the integral role small businesses play in Canada’s economy and sheds light on how these businesses can thrive despite major economic forces working against them — including the rising cost of doing business, the highest borrowing costs in over two decades and increased pandemic debt loads.
While 98 per cent of Canadian businesses qualify as small businesses, the report goes further in illustrating that micro firms are by far the most common businesses type in Canada, with the median firm having fewer than five employees. This underscores the importance of improving our understanding of the business realities of all small firms, but especially micro firms, while ensuring that adequate financial, operational and regulatory support measures boost the resilience of small and micro businesses for the sake of Canada’s economy.
Put simply, the survival of micro firms is a macroeconomic issue for Canada, and policymakers should be attuned to the needs of these small businesses.
Highlights from the report
- In June 2023, there were 1.35 million businesses in Canada with paid employees. The overwhelming majority (98% of the total) were conventionally classified as “small” businesses, which collectively employed over 11 million people.
- In the “small business” category, micro firms are by far the most common businesses type in Canada. In fact, if all businesses in Canada were sorted by employment size, the median firm would have fewer than five employees
- Nearly half of all small businesses are in the following four industries: professional, scientific, and technical services; construction; retail trade; and health care and social assistance.
- Immigrants to Canada own a disproportionate share of private sector businesses (263,850 businesses, or 25.5% of all private sector businesses) compared with their share of population (23%). One strong factor is immigrants’ high share of micro businesses (30%), in contrasts with their under representation in both scale and mature enterprises.
- The past few years have offered women more flexible work arrangements, encouraging them to find more in-demand and higher-paying jobs, while government efforts to increase the availability of affordable childcare have helped women’s labour force participation to rebound. With the transition back to the office, barriers that perpetuate gender-based differences in labour force participation threaten this progress.
- Retail sales data show that e-commerce enjoyed a massive spike early in the pandemic, but have since moderated as Canadians go back to in-person shopping. The share of total retail 3 sales from e-commerce increased rapidly from 3.7% in January 2020 to peak of 10.7% just four months later in April 2020. With the lifting of pandemic related restrictions and stores have reopened for in-person shoppers, this figure has since moderated to 5.7%.
- 83% of Canadian retail shoppers reporting they conduct online research before they visit a store. Having physical stores near customers also supports online sales, with nearly 1 in 10 Canadians making purchases online from retailers located nearby.
