Small Businesses Are Our Backbone

According to the Government of Canada’s statistics, as of December 2017, 97.9% of employer businesses in Canada were small businesses. That amounts to 1.15 million out of 1.18 million employer businesses. A staggering proportion—more than half—of those small employer businesses are concentrated in Ontario and Quebec. The numbers send a clear message: small businesses continue to form the backbone of the Canadian economy.

Read: “Key Small Business Statistics – January 2019”

I, along with plenty of other concerned citizens, have noted how Finance Minister Bill Morneau’s tax hikes on small businesses have targeted middle-class Canadians. The Liberals were forced to back down after facing wide criticism. We cannot build and grow a strong Canadian economy without giving the middle class the tools to succeed.

Political coverage tends to focus on national issues, so it’s easy to focus on macro-economic trends, so it’s easy to forget that so much of what makes the Canadian economy function happens at a local, community level. Building up small businesses means getting good information to business owners at the local level. Last month, I helped organize a breakfast event on succession planning for small business owners. The Business Development Bank of Canada (BDC) and the Clarington Board of Trade (CBOT) were partners in this event which focused on providing critical information on succession planning and finding willing investment partners. Many family-owned businesses have challenges passing on the operation to the next generation. This means they have to explore a strategic sale or employee buy-out to keep the operation going after the founders retire. This issue impacts the entire community and not just this family. Whether the business employs 5 people or 25 people, the hope is that succession planning keeps the business operating, adding to our local economy and providing employment for people in our community.

The core message of the breakfast? Start planning early for succession arrangements. When I talk to business owners, they often assume that succession is a relatively simple affair. But in most cases, planning a smooth succession for your business is a lengthy and often difficult process. Long-term planning and communication – with family and employees – is critical for a succession to be successful.

The statistics I outlined at the beginning of the article tell you why succession planning and the success of small and medium sized businesses are so important to our economy. Most businesses are smaller. The General Motors and the OPGs are few and far between. The vast majority of Canadians work for small and medium sized businesses. In fact, 70% of Canadians working in the private sector work for small businesses. When I was in cabinet in the last Conservative government we would always keep this statistic in mind and do whatever we could to foster success and growth in small business. There are 1.15 million small businesses in Canada presently employing about 8.3 million Canadians. If every small business in Canada hired an additional employee, it would virtually eliminate unemployment in Canada. That is a theoretical approach, but it underscores just how important small business is to our economy and why we should have policies that keep these businesses competitive and investing in the economy. It also explains why succession planning for a number of businesses in Durham are so important to our wider economic success.

The Liberals have been quite obtuse when it comes to fostering the success of small business and it stems from their own biased view towards entrepreneurs and risk takers. In fact, in an interview with Peter Mansbridge in the last election Justin Trudeau suggested wealthy people used small businesses as a means to avoid paying taxes. This was the view of the person who became Prime Minister of Canada. His Finance Minister used similar language suggesting small business owners were not paying their “fair share” without explaining how small business owners have to provide for their own life events, maternity leaves and retirement planning. The Liberal government was also the first government to not consult the Canadian Federation of Independent Business (CFIB) on their budget planning, despite the fact that CFIB represents small business and more employers than any other group in Canada. It has not been lost on many small business owners, physicians and farmers that both Trudeau and Morneau come from positions of privilege having inherited family fortunes. They did not have to take risks and do not understand the plight of small business owners and entrepreneurs.

Read: “Justin Trudeau blasted by rivals for ‘smearing’ small business”

Read: “Trudeau says wealthiest Canadians using small business tax rate to avoid taxes”

One of the best parts of my role as Member of Parliament has been to meet some of our small business owners in Durham, hearing their stories and visiting their stores or shop floors. I try and do this all the time to understand the issues they face on a national and local basis. I have also had the chance to do this on a national basis touring businesses and meeting owners from coast to coast. In fact, the first blog I wrote as MP was on small business and I speak and write regularly on the subject. There are two elements that all small business owners have in common. First, the business is their life. They always have to be available and the family revolves around the business. Whether it is a restaurant, a steel fabricator or a business making speakers for the latest Drake tour, these families are never “off” even when they step away for a few days. The second element in common is the fact that at one point in time they have risked the financial well-being of their family to build their business and keep their employees on the payroll. Some face these risks in the early start-up years, while others may find difficulties when they lose a client or when the economy is in recession. Risk is inherent in what they do and that is why government should foster the environment for small business, or at least have a “do no harm” approach. Small business will remain a priority for me as Member of Parliament and will become a priority again should we form the next government. If you would ever like me to tour or learn more about your store or small business, please let me know. We can be reached at