The number of Canadians starting businesses has fallen by almost half in two decades, according to a recent study from the Business Development Bank of Canada (BDC) released Monday.
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The survey, conducted by the BDC in collaboration with the University of Montreal and the Millénium Québecor program, found that despite a population of 40 million, the country has 100,000 entrepreneurs less than 20 years old.
This alarming trend was felt in 2022, when on average only 1.3 out of 1,000 people had started a business, compared to 3 out of 1,000 in 2000, according to the BDC study, which expressed concern over this decline.
A low unemployment rate, high salaries, an aging population and a more complex business environment are factors that have exacerbated the situation, the financial institution’s report said.
“This trend is worrying because entrepreneurship is crucial to the economy and drives innovation and economic growth,” Pierre Cléroux, vice president of research and chief economist at BDC, said in a press release.
According to the same study, a third of founded businesses close their doors after five years, representing a contradiction between the intention to start a business and entrepreneurial success.
“To close this gap, it is important that entrepreneurs acquire essential skills to start and grow their businesses, especially in an increasingly complex business environment,” recommended Cléroux.