EDITORIAL: How Canada became a business wasteland

“This prolonged imbalance between business exits and new entries places us in an entrepreneurial drought — a trend that threatens Canadian innovation, competitiveness and business dynamism,” the report says

Published Apr 26, 2026  •  Last updated 17 hours ago  •  2 minute read

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Two recent reports by the Canadian Federation of Independent Business (CFIB) reflect on different aspects of difficulties faced by small companies trying to survive in the Canadian business landscape.

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One report says this country is in an “entrepreneurial drought” that threatens business dynamism.

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A story by Postmedia journalist Bryan Passifiume quotes CFIB analyst Joseph Falzata saying the report, Canada’s Entrepreneurial Drought, is a “wake-up call” for all levels of government. It says business entry rates in Canada have fallen almost 50% since the mid-1980s and remain at historic lows. The most recent drought has shown little sign of improving since it began in 2024.

“In the second quarter of 2025, exit rates decreased slightly to 5.6%, while entry rates fell to 4.9% (fourth quarter of 2025), marking some of the highest closure rates and weakest start-up activity outside the pandemic,” says the report.

“This prolonged imbalance between business exits and new entries places us in an entrepreneurial drought — a trend that threatens Canadian innovation, competitiveness and business dynamism,” the report says.

Falzata points out that since 98% of all businesses are small, it’s important to maintain the right environment to encourage growth.

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The CFIB is calling for governments to lower taxes, cut red tape and remove barriers to entrepreneurship to encourage more business start-ups.

In another report earlier this month, CFIB said crime is a daily pressure for small businesses.

“Owners should not be spending more time and money managing theft, vandalism and safety risks than running their business,” CFIB analyst Kayode Southwood said in the April 8 report, adding, “The financial strain and emotional toll are exhausting.”

He said business owners report they’ve spent thousands of dollars on security cameras or replacing smashed windows. Nearly half of small business owners report concerns about their own safety and the safety of their staff and customers.

“Governments need to respond with stronger consequences for repeat and organized offenders, streamlined reporting and faster responses from police and supports aimed at prevention and recovery.”

This country used to be fertile ground for entrepreneurs with hopes and dreams and the willingness to work hard and take risks to create new wealth.
We’ve become a place where people are timid about investment and fearful for their safety if they show any kind of business initiative.

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