No Trivial Matter
Small Business In Canada
Some lesser-known facts and figures about Canada's economic engine
Canada's small-business sector is anything but trivial. The fact is, small enterprises and the self-employed contribute as much or more to the economy than the large businesses that often take credit for Canada's economic growth.
Did you know, for example, that self-employment creates 75 per cent of all new jobs in Canada, or that 97 per cent of all Canadian businesses have fewer than 50 employees?
Read on, and we'll treat you to some trivia that will offer some insight into the vibrant small-business sector, the unheralded "engine" of the national economy.
Love that self-employment: One in six Canadian workers is self-employed compared to one in eight in 1977. And from 1990 to 1997, the number of self-employed workers grew from 1.9 million to 2.5 million. During that period, self-employment contributed more than three out of every four new jobs created in the Canadian economy.
On the Web: Internet use among Canada's small businesses is growing rapidly, from 22.4 per cent in January 1997 to more than 60 per cent in 2000.
Bye-Bye Buck: Canadian small businesses bid farewell to paper dollar bills on June 30, 1989. The bills were replaced by a coin which was nicknamed the "loonie.'' Seven years later, the $2 note was withdrawn, also replaced by a coin, which was known as the "twonie.''
Bankruptcy beckons: For many new-born Canadian businesses, the odds of a long life are low. There is a one-in-three chance that a start-up business will survive beyond its fifth year and, in fact, only about three in four new enterprises survive for more than a year.
No dough: Canadian firms with fewer than 50 employees have found it more difficult to negotiate loans in recent years. According to the Canadian Federation of Independent Business, the rate of loan rejection in 1987 was 12 per cent for firms with four or less workers but 14.5 per cent in 1997; eight per cent in 1987 for companies with five to 19 workers, compared to 11 per cent in 1997 and six per cent in 1987 for firms with 20 to 49 workers, compared to seven per cent in 1997.
Shop 'til you drop: Park Royal Shopping Centre in West Vancouver opened in 1950 and was Canada's first suburban shopping mall. The mall now has a north side (the original mall) and a south side, which was constructed beginning in the 1960s.
Small businesses rule: About 78 per cent of Canada's 1 million businesses employ fewer than five people and 97 per cent of all businesses have fewer than 50 employees, the upper limit most often used in defining small business. Businesses with more than 50 employees make up less than three per cent of Canada's business population.
Sweet exports: There are an estimated 30 billion honeybees at work in Canada, mostly on farms on the Prairies. Most recent statistics show these busy bees were responsible for $70 million worth of honey, 33 per cent of which was exported to the United States. Canada also sent honey to Germany, the United Kingdom, Japan and France.
Profits on the rise: Small-business net profit margins are $18,500 or 5 per cent of gross revenue. That's an improvement from the early 1990s when profits represented 3.9 per cent of gross revenue.
Oh, no! Income tax: Income tax, the scourge of many a Canadian small business, arrived in 1917 when the Income War Tax Act was enacted. It was presented as a temporary measure to help finance Canada's war effort in World War I. Not surprisingly, the tax proved too good for the government to give up, even though the war it financed ended on Nov. 11, 1918. It's been with us ever since.
Booze is big: One of Ontario's most successful one-time small businesses has proved to be the Liquor Control Board of Ontario. In 1927, the LCBO was launched as a 16-store chain to look after the sale of liquor. Today, there are about 700 LCBO outlets in Ontario, which register annual sales of more than $2 billion, making the LCBO the single largest retailer of beverage alcohol in the world.
More small-biz tidbits . . .
Where the jobs are: Small and medium-size businesses account for more than 58 per cent of total employment in Canada, up from 54 per cent in 1989. In the past decade, firms with 500 or more employees have seen their share of total employment drop from 46 per cent to 42 per cent.
Retirement Savings: Registered Retirement Savings Plans (RRSPs), which finance the golden years of most small business persons, were unveiled in 1957. RRSPs enable Canadians who are either self-employed or do not belong to a company pension plan, to put aside money for their retirement on a tax-deferred basis.
Home is where the work is: More than half of all self-employed Canadian entrepreneurs operate their businesses from home, according to the latest data from Statistics Canada. These people amounted to 1,126,000 entrepreneurs.
Cash for trash: Recycling became a lucrative pastime for many Canadian small businesses in 1982. That's the year Kitchener, Ontario introduced Canada's first blue box program for the re-use of household paper, glass and cans. The Blue Box has become widely used in Canada in response to widespread public demands for better waste management.
Ouch!: Rising Canadian postal rates have taken their roll on the bottom line of many small businesses over the years, especially since the 1970s. In 1910, it cost 2 cents to mail a one-ounce letter; the price of a stamp rose to 6 cents in 1970, and in 2000, a stamp costs 46 cents.
Demise of the small farm: In 1901, there were 543,000 farms in Canada. As Canada's population swelled, the number grew to 623,087 in 1951. Today, less than 275,000 remain because rising costs and falling incomes have forced many small farms amalgamate with larger operations.
About the author:
Randy Ray is an Ottawa free-lance writer and co-author of "The Great Canadian Trivia Books," "The Great Canadian Book of Lists" and "The Ontario Fact Book," which can be seen at
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