Rebecca Reuber, a professor at University of Toronto’s Rotman School of Management, sees encouraging signs for entrepreneurialism across Canada and labels its state “quite healthy.”
A study for Industry Canada she recently co-authored, the State of Entrepreneurship in Canada, found that the birth rate of new firms with paid employees is consistently higher than the death rate, meaning the pool of budding young businesses is rising:
The birth rate increased 12 per cent in 2006 from 9 per cent in 2001, and the numbers compare favourably with those of other industrialized countries.
Slightly more than half of Canadian businesses survive their first five years of operation.
The number of self-employed Canadians with an incorporated business increased to 6.3 per cent of the working population in 2008, from 5.5 per cent in 2003. There is a strong family influence on self-employment. “Having parents who are self-employed can provide business skills that are important even when the business is in a different industry than that of the parents,” says the study.
One of the major indicators of the success or failure of a startup is motivation, Ms. Reuber said. “There can be startups for the wrong reasons.”
In tough times, there can be a tendency for more people who have lost their jobs or who face financial difficulties to go into business for themselves more out of desperation than out of a positive identification of opportunity, she added.
