Despite tough economy, entrepreneurs are flourishing
October 30, 2012
When economies flounder, one of the first populations to be affected is small business owners. Often during these times of turmoil, enterprises have to scale back their offerings, layoff employees and put off any potential expansion. Since the 2008 recession, a number of economies around the world have experienced their fair share of downturn.
The Canadian financial situation is no different. In fact, the nation is still seeing somewhat dismal numbers even four years after the recession. Despite this fact, small businesses in Canada are actually performing well currently, driving much of the economic growth that is slowly but surely turning the fiscal climate around.
Exchange rates, optimism, overall climate down
According to the Vancouver Sun, the current economic landscape is not particularly lush in Canada right now. The source cited a very poor exchange rate, a relatively low amount of business confidence by owners and unstable politics as factors that continue to keep the Canadian financial situation somewhat dismal.
These elements make it hard for companies in nearly any industry to flourish properly, the newspaper suggested. However, smaller firms seem to be the ones making their mark on the fiscal climate.
"Ninety-eight percent of businesses in Canada have 100 or fewer employees and less than $5 million in revenues," KPMG Enterprises partner Frank Boutzis told the Sun. "At the same time, their contribution to the economy is in excess of 30 percent of Canada's GDP and they account for 48 percent of the labor force in the private sector."
Small businesses continue to grow
Though the odds are currently stacked against company growth in the northern nation, enterprises with fewer people on the payroll are doing well and many are even looking to expand.
The Calgary Herald, citing the 2012 RBC Small Business Survey, reported that 29 percent of small business leaders are planning on hiring more employees within the next year, representing a 4 percent increase from the same sentiments in 2011. Many entrepreneurs conceded that finding experienced help was hard, however. An additional 68 percent said they plan on investing more capital into their firms over the next 12 months.
The survey also noted that 94 percent of Canadians say that these smaller enterprises play a large part in the growth of the economy, while 88 percent called them vital job creators.
Moreover, the Canadian Press said that a number of owners are optimistic about the growth of offerings in a number of industries around the country, citing a survey by the Canadian Manufacturers and Exporters association. Many respondents said that they expect their markets to expand to Europe, China and Brazil, but noted that the Canadian and American markets will continue to remain the most lucrative.