Fueled by inflation and rising interest rates, corporate bankruptcies rose 37.2% in 2022, the highest rate recorded in 30 years.
Bankruptcy figures from the Office of the Superintendent of Bankruptcy show 3,400 companies that filed for bankruptcy in 2022, up from 2,480 in 2021.
Quebec recorded the highest number last year with 1,945 bankruptcies, followed by Ontario with 906 bankruptcies.
The construction, lodging and hospitality, and retail sectors saw the largest increases at 150%, 130%, and 119%, respectively.
“Construction, accommodation and catering services and retail sales have been hit hard over the past year,” said Jean-Daniel Breton, President of CAIRP, in a statement.
“Many companies in these sectors have been pressured by rising costs, labor shortages, retention issues and weak consumer demand,” Breton said.
“The fact that business owners are struggling to manage all of this and that the cost of borrowing is becoming increasingly onerous suggests that the number of companies looking for solutions to reorganize or reduce their debt continues to grow will,” he predicted.