Business closures doubled in Canada during height of pandemic
The COVID-19 pandemic forced tens of thousands of Canadian businesses to close in the first full month of lockdowns.
In April, Canada recorded 88,187 business closures, Statistics Canada reported Wednesday in Ottawa. That’s more than twice the 39,078 that shut down in the same month last year. The report also showed fewer new businesses are opening.
The data provide the fullest picture yet of how forced shutdowns of large swathes of Canada’s economy ravaged some sectors, potentially leaving longer-term damage on activity if some of these businesses don’t reopen once the lockdowns are lifted.
Accommodation and restaurants, along with other industries that cater to individuals, recorded the most closures in April. Retailers were also hit hard. That coincides with employment data showing large numbers of layoffs in these sectors as demand for in-person services collapsed during the pandemic.
Canada’s three largest cities recorded the largest number of closures, with Toronto leading the pack.
The data only reflects closures in the first full month of the COVID-19 lockdowns, and many more are likely to have shut down since.
A survey by the Canadian Federation of Independent Business taken at the end of June found another 150,000 Canadians businesses, or 14 per cent of the total, are at least somewhat considering bankruptcy or winding down their operations because of COVID-19.
The report also found that fewer businesses are opening. Canada recorded 32,803 new businesses in April, down about 18 per cent from a year earlier. The number of businesses in operation -- at 679,336 in April -- is the lowest since the statistics agency began tracking this data in 2015.