What's Happening?
A report by the Business Development Bank of Canada (BDC) highlights the potential economic impact of self-employed Canadians transitioning to employer businesses. The survey of 851 self-employed individuals found that 11% plan to hire employees within the next year. This shift could create 213,000 new businesses and add approximately $24 billion to Canada's GDP. The report notes that small- and medium-sized businesses contribute significantly to the economy, generating about half of Canada's GDP. The resurgence in self-employment follows a decline during the COVID-19 pandemic, as many individuals returned to traditional jobs.
Why It's Important?
The potential growth in self-employment and entrepreneurship could significantly enhance Canada's economic landscape.
By supporting self-employed individuals in becoming employers, the country could see increased job creation and economic diversification. This shift is particularly important in the context of a challenging job market and the desire for more flexible work arrangements. The report suggests that providing financing and coaching to self-employed individuals could facilitate their transition to employer businesses, thereby strengthening the overall economy.
What's Next?
The BDC report indicates that the first five years of a business are crucial for growth, with ambitious self-employed individuals most likely to hire during this period. Policymakers and financial institutions may focus on providing targeted support to these entrepreneurs to maximize their potential impact on the economy. As the trend towards self-employment continues, there may be increased emphasis on creating favorable conditions for small business growth, including access to financing and business development resources.
