Ontario sees fastest fall in small business employment
All five regions covered by the Index had lower small business employment in July compared to June: Ontario, British Columbia, Atlantic, Prairies, and Québec (in that order, from fastest to slowest rates of decline).
- Ontario had the largest decrease in small business employment in July, at 0.59%, which is equivalent to a loss of 11,300 jobs. This made a significant contribution to the national drop in small business employment last month, with roughly 40% of Canada’s small business jobs located here.
- Québec had the slowest rate of decrease in small business employment in July, at 0.43%. This is equivalent to 4,700 fewer jobs across the province compared to June. This is a shift from last month, when Québec had the fastest falling small business employment.
Ufuk Akcigit, the Arnold C. Harberger Professor of Economics at the University of Chicago, said: “In Canada, inflation has continued to slow down, with the Consumer Price Index registering a 2.8% year-over-year increase in June, following a 3.4% increase in May. However, despite the efforts to control price increases, the national unemployment rate rose by 0.2% in June, reaching 5.4%, the highest level since 2022. This increase indicates the ongoing challenges faced by the labour market, which may have been exacerbated by the wildfires that affected multiple sectors across the country. These wildfires not only damaged households and businesses in the affected areas but also constrained credit conditions, making it harder for small businesses to access capital.
“The Intuit QuickBooks Small Business Index reflects some of these challenges, with a contraction of 0.42% in employment for firms with 1-19 employees. This negative growth followed a 0.35% decline in June, underscoring the difficult macroeconomic environment. Regionally, the largest fall in small business employment was seen in Ontario, down by 0.59%.
“On a sector level, the most significant drop in small business employment occurred in the agriculture, natural resources and mining sector, down by 1.42%. The widespread wildfires in May and June had a profound impact on this sector, including a notable reduction in the available timber harvest. According to the Canadian Wildland Fire Information System, the destruction caused by these fires to date has been 13 times higher than the 10-year average.
“Conversely, there were positive developments for the utilities sector in the past month, which includes energy. Statistics Canada recently reported a substantial energy price decrease of 14.6%. This price fall was complemented by rising small business employment in the sector, with an impressive increase of 1.09%, according to the Intuit QuickBooks Small Business Index. It’s encouraging to see the Index reflecting what we see in official data.”
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USA Index
The Intuit QuickBooks Small Business Index is also published monthly in the US. Get the latest small business employment insights for the US here.
UK Index
The Intuit QuickBooks Small Business Index is also published monthly in the UK, a few days after the US and Canada. Get the latest small business hiring insights for the UK on August 7.