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Starting a small business easier in Canada: survey

Starting a small business easier in Canada: survey


Starting a small business in Canada is easy - at least compared to the rest of the OECD countries.

Only New Zealand and Australia beat Canada in an index that measures the time and costs necessary to incorporate and register a new firm, according to an extensive report on entrepreneurship by the Organization for Economic Co-operation and Development using data from 2007.

Both the provincial and federal governments have taken steps to make it easier to start businesses, said Dan Kelly, a senior vice-president at the Canadian Federation of Independent Business. He cited Biz Pal, a manual that outlines all the forms required for a startup to get on its feet, as a successful government initiative for fostering entrepreneurship.

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"There's no question there have been steps taken to make it easier to get into business," he said.

But if a startup is in Canada's manufacturing sector, there is only about a 50-50 chance the enterprise will make it past the two-year mark.

"The challenge is that when firms start to grow, when they start to take on more staff, the rules and red tape start to balloon," Mr. Kelly said.

Businesses in the service sector are slightly more likely to survive. This makes Canada an exception across all OECD countries, where service businesses die more rapidly.

Services, although they can be "notoriously challenging to nurture and grow," make up a large part of the Canadian economy, Mr. Kelly said.

Foreign-born Canadians were more likely to be self-employed than those who were born in the country, the report continued.

Entrepreneurship is often the best way for new immigrants to enter the workforce and get their skill set recognized, Mr. Kelly said of this well-documented trend.

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"They contribute a great deal and create employment for those of us who were born and raised here," he added.

Canada also had the lowest number of bankruptcies of all the countries surveyed.

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