Sunday, May 26, 2024
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SMBs: the force driving Canada’s economic recovery

by Mark Hickman, Managing Director, Sage in Canada

Navigating an unknown economic landscape as a potential recession looms can be daunting for businesses and consumers. Faced with global economic uncertainty, such as rapid inflation due to the pandemic, the past few years have been a turbulent time for Canadian and global SMBs.

We can’t tell the future, but we can analyze the past, and by doing so, we can have a greater understanding of the possibilities that are to come. The SMBs Driving Economic Recovery report from Sage and the Centre for Economics and Business Research recently reviewed eight global economies, including Canada’s, analyzing their recovery following a financial downturn through the lens of SMBs. The final results forecasted how Canadian SMBs will once again be a driving force behind modern economic recovery.

Looking back to move ahead in a modern economy

According to the report, following the 2009 global financial crisis Canadian SMBs proved resilient in relation to SMB growth and employment. Although employment by SMBs fell slightly, the number of SMBs increased slightly, effectively raising employment amongst SMBs to above pre-crisis levels by 2010. Specifically, employment amongst SMBs increased by over one million into 2015. 

Looking ahead, similar employment growth among Canadian SMBs is expected by 2025, with a forecasted increase of employment amongst SMBs to reach 14.6 million and the number of SMBs increasing to nearly 1.4 million – meaning that SMBs will make up 98.3% of all businesses and 84.5% of total employment in Canada by then.

As vital generators of labour and an expectation of resiliency to maintain the economy through the next financial crisis, SMBs will require modern solutions and external support.

Technology is a proven key to recovery

Of all the sectors contributing to growth globally, sectors that were most resilient made the strongest gains from digitizing processes and were crucial to the economic recovery following the 2009 recession. With a strong correlation between technology and business success in today’s landscape, the adoption and implementation of tech infrastructure will be key – as demand across industries increases, modern solutions are required to maintain business expectations.

A previous report from Sage found businesses that adopted new technology during the pandemic felt more confident in the businesses success over the following year. It also found that 44% of small businesses want adequate funding and support from the federal government to survive, and 39% said there’s a need for help at the provincial government level.

By investing in technology to overcome barriers such as staffing or productivity, businesses can improve efficiencies in their operations, sales, and customer experiences. To do so successfully, they should continue to access available programs that prioritize the adoption and implementation of technology. 

Accessing external resources, such as government programs like the Canada Digital Adoption Program (CDAP) – which was introduced to assist SMBs with their digital transformation plans, allowing businesses to adopt the technology needed to expand their online presence or increase output and employment among SMBs – can be utilized alongside digital software solutions, such as those offered by Sage, that drive efficiency through automation and workflow.

Small businesses continue to be the driving force of Canada’s growing economy. By providing much-needed software solutions, such as solutions in the Sage software suite, business leaders can focus on implementing digital processes that drive efficiency in innovation and value creation, and effectively free up time allowing leaders to focus on business aspects that are most important – including their people. 

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