According to a new survey, one in six entrepreneurs is considering closing their business due to the impact of the COVID-19 pandemic.
Rodrigo Diaz M.
More than 200,000 Canadian companies could close their doors permanently during the COVID-19 crisis, leaving millions of people without work.
The Canadian Federation of Independent Business (CFIB) said today that one in six Canadian small business owners – or about 181,000 – is seriously considering closing.
The latest figures, based on a survey of its members between January 12 and 16, are added to the 58 thousand companies that have already closed during 2020.
An estimate from the CFIB last summer said that one in seven companies (158,000) was at risk of bankruptcy as a result of the pandemic.
According to the updated forecasts of the organization, more than 2.4 million people could be without work, 20% of the jobs in the private sector.
Simon Gaudreault, CFIB’s senior director of national research, said the increase in the number of companies considering closing was alarming.
“We are not going in the right direction, and each week that passes without improvements on the business front pushes more owners to make that final decision,” he said in a statement. “The more businesses disappear, the more jobs we will lose and the more difficult it will be for the economy to recover.”
In total, one in five businesses is at risk of closing permanently at the end of the pandemic, according to the organization.
The grim new investigation comes after a brutal year for Canadian companies.
“The beginning of 2021 is more like the fifth quarter of 2020 than a new year,” said Laura Jones, executive vice president of the CFIB, in a statement.
The official called on governments to help small businesses “replace subsidies with sales,” introducing safe ways to reopen businesses.
“The stakes are high right now, from jobs to tax revenue to supporting local soccer teams,” Jones said. “Let’s make 2021 the year we help small businesses survive and thrive again.”