One in seven small businesses are at risk of going under as a result of COVID-19 in addition to the ones that have already closed, warns the Canadian Federation of Independent Business (CFIB) in a new report released on Wednesday.
The national organization’s mid-range estimate for business closures due to COVID-19 is 158,000 (14 per cent of small businesses). Depending on how the recovery goes, losses could be as few as 55,000 (five per cent) or as many as 218,000 (19 per cent), it said.
Alberta could lose an additional 32,500 small businesses as one in five are at risk of closure.
“Small businesses are big players in our economy, so minimizing business losses is critical to recovery. Right now both government support and consumer behaviour are critical to transitioning back to conditions that allow businesses to survive and thrive,” said Laura Jones, Executive Vice-President at CFIB, in a news release.
“With many provinces heading into a long weekend, we hope people will visit smallbusinesseveryday.ca and accept a challenge as a fun way to spend time with friends and family while helping local businesses. It’s all about supporting our favourite businesses today so they will be here tomorrow. There are many great campaigns that help amplify that support. No one is too small to make a difference.”
The CFIB said businesses in the arts and recreation (gyms, venues, arcades) and hospitality (restaurants, hotels, caterers) sectors are most at risk—hospitality may see 27 per cent of businesses close and arts and recreation, 30 per cent. Businesses in Alberta face the highest risk of closing, with a mid-range estimate of 19 per cent going under as a result of COVID-19.
The organization said 62 per cent of small businesses are fully open; 37 per cent are fully staffed; and 26 per cent are making normal sales.