The current recession has been a struggle for global industries and manufacturing, without a doubt. We ve seen the down turn of the automotive industry, a faction that no one ever imagined could possibly crumble. The economy has taken a toll on big business and corporations, and the names we thought we could always rely on have been in the news touting signs of trouble and despair.
Nevertheless, in Canada, the little guys are holding on tight.
Canadian Imperial Bank of Commerce recently reported that small and medium sized businesses in Canada (known as SME s), have shown surprising resilience in the face of this recession. CIBC economist Benjamin Tal did some research and discovered that while the big boys had a ten percent decrease in employment, their smaller competitors showed no such job cuts, and maintained relatively the same number of employees. Furthermore, the report indicates that small business bankruptcies are actually down year over year for the period to July 2009. Down, in fact, by just over 6 percent.
Canadian small business has consumer loyalty to thank for helping them weather the economic storm. Of course, it s the nature of smaller businesses to be grateful and show their appreciation, which in turn, keeps those same consumers loyal.
By standard of practice, smaller businesses have less people doing more work to keep budgets in line, while their larger counterparts look at wages first when it comes to reducing expenses. While small business might lower the hours of some employees to tighten the belt, they still need the same staffing level to run effectively. Multi tasking is part of the job in small business.
The trend of small and medium sized businesses resisting the negative effects of the recession is expected to continue. While the strength of the Canadian dollar is hurtful to many large companies, smaller businesses don t feel the sting quite so dramatically. In fact, three out of four Canadian small businesses are not impacted by the current status of the loonie at all.
Small business in Canada has always been a staple of our economy. It s only in the last couple decades that we have seen the insurgence of jumbo corporations and retailers make a home within our borders. From grocery stores, flower shops and hardware stores to the corner convenience stores, Canadian small businesses proudly stand among the giants, defiantly refusing to wither away. In Canada, we all know at least one person who is self employed . Furthermore, the growing embrace of the World Wide Web has brought new life to Canadian manufacturers of everything from eco friendly cleaning supplies to flags and yes, even kitchen sinks.
Mr. Tal also states that Canadian small business will continue to play an increasingly important role [in the Canadian economy] . That s likely an understatement, since throughout the history of Canada, it has always been the Mom & Pop shops, the print and press shops, the bakers, the hairdressers, the mechanics, the independents and the franchisees who hang tough, who lend a helping hand to their neighbours, and receive the same when the time is due. In a country that s built on small towns, small business is a way of life.
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