Reports released on small businesses indicate that Canadian owners are struggling
By Luana Ross, Contributor
As of 2019, small-sized businesses employed 68.8 percent of the total private workforce in Canada
A report released this February by The Canadian Federation of Independent Business (CFIB) estimates that the owed debt of small businesses our country has reached up to $135 billion. The average debt of each business owner is estimated to be at $170,000, and 76 percent say it will take them longer than a year to pay off their accumulated debt. In surveying over 3,500 Canadian small business owners the CFIB found that a quarter of small businesses state that they are making the normal and expected amount of sales they typically would at this time of year. While some sectors are doing better than usual (e.g., wholesale, construction, manufacturing, transportation), others like hospitality, arts, recreation & information, and social services are often deemed nonessential by their provincial government and cannot make the transition to online—and this has resulted in many taking on large amounts of debt. And of those who have taken on debt, the future is a problem as about 40 percent have already hit their debt limit according to a Canadian Chamber of Commerce report released early this March.
In Vancouver, the CBC reports that a small sample size survey by the Greater Vancouver Board of Trade found that 62 percent of businesses are still seeing a steady decrease in sales. An earlier report from January by the CFIB received answers indicating that one in six small business owners were looking at potentially shutting down for good in the face of COVID-19 restrictions. The previously mentioned Canadian Chamber of Commerce report reflects that grim reality for business owners as 51 percent reported being uncertain in how long they could stay afloat with their current earnings before going broke. This is pressing concern because as of 2019, small-sized businesses employed 68.8 percent of the total private workforce in Canada (while medium-sized businesses employed 19.7 percent of that same group).
Small and medium retailers have additionally been struggling competing with big box stores as many of the large corporations have been deemed essential services (like Walmart due to its grocery section) while small businesses were met with restrictions and shutdowns. Many large stores were able to quickly modify themselves to meet the needs of the pandemic but small and medium business owners could not. In an article for The Star, Ontario alpine ski resort owner Chris Bishop criticizes the shutdown of ski resorts as he invested $50,000 in safety measures and followed all the rules but was still closed down. He comments that his hill “seems as safe to me as it would be to go to Costco or go to Walmart.”