Late last month, Statistics Canada released data on active businesses in Canada, and I thought I’d go through it to see how Alberta fared.
The most recent data is January 2023, so keep that in mind.
First, here’s the number of active businesses in each province, as of January 2023.
Alberta came in fourth place, which shouldn’t be that surprising given that it has the fourth highest population as well.
Now, let’s look at how that number compares to the past. First, over the previous month.
|Dec 2022||Jan 2023||Change||% change|
Between December 2022 and January 2023, nearly every province saw a gain in the total number of active businesses. Alberta saw the third largest increase in active businesses in the country. The province’s active businesses increased by 809, from 119,045 to 119,854.
Newfoundland and Labrador, which was at the bottom of the list, saw 18 fewer active businesses this past January than they did the month before. Ontario, with a gain of 2,779, was the best performing province in the country.
Even on a percentage basis, Alberta had the third largest gain, behind only Ontario and Manitoba.
Now let’s take a look at how things changed in each province over the past year.
|Jan 2022||Jan 2023||Change||% change|
Alberta gained nearly 2,000 active businesses over the past 12 months, the fourth largest increase the country. Ontario topped the list, with over 10,000 more active businesses. Québec and BC were in second and third place, respectively, with 3,597 and 2,429 more businesses.
Newfoundland and Labrador was the only provinces to see their number of active businesses drop over the last year.
Since December 2021, the number of active businesses in Alberta increased 1.67%, the fourth largest increase among all provinces.
Of the other provinces, six of them saw increases near or higher than 1% between January 2022 and January 2023, and one of them was above 5%. The national average was 1.64%, roughly roughly the same as the increase Alberta saw.
The story is pretty much the same when comparing 2 years.
|Jan 2021||Jan 2023||Change||% change|
Alberta’s increase of roughly 4,000 active businesses over the last 2 years keeps it in 4th place; however, they drop to 7th place on a percentage basis (3.46%). That’s where things start worsening for Alberta.
Now, let’s look at active businesses over the last 3 years to see what I mean.
|Jan 2020||Jan 2023||Change||% change|
January 2020 was 7 months after Alberta’s UCP government implemented their so-called Job Creation Tax Cut. When they implemented it, they claimed it would lead to tens of thousands of more jobs being created.
However, what we see is that in the 7 months since the UCP government cut the tax rate on corporate profits, Alberta was bumped from its fourth place spot to 5th place, even though we gained 863 active businesses.
Only one province—Newfoundland and Labrador—saw a loss in total active businesses between January 2020 and January 2023.
The largest increase was seen in Ontario, which has over 14,000 more active businesses than they did in January 2020.
On a percentage basis, Alberta’s gain of 0.73% of its active businesses over the last 3 years, however, was the second worst increase, on a percentage basis. Only New Brunswick saw a lower percentage increase than Alberta.
Finally, here’s how things looked compared to January 2019, the last January under the NDP.
|January 2019||January 2020||Change||% change|
Alberta had the worst performance of all the provinces in Canada that saw increases, gaining only 136 active businesses. Newfoundland and Labrador was the only province that saw a decrease, so they were technically in last place, but of the provinces that saw increases, Alberta did the worst.
Ontario saw the largest increase in total active businesses since January 2019, increasing by over 17,500.
On a percentage basis, Alberta was still in last place among the provinces with increases, at just 0.11%. PEI was in first place, increase the number of their active businesses by nearly 10%.
Here’s another look at the numbers over the last 4 years.
You can see the huge drop in active businesses in the beginning of the COVID-19 pandemic. Another thing this chart clearly shows is that any growth in active businesses that have occurred during the UCP administration has been almost entirely recovery growth.
After all, even though the 119,854 active businesses we saw in January 2023, is the highest it’s been since the pandemic began, it’s still lower than where it sat when the UCP took power.
In April 2019, the month the UCP won the provincial election, Alberta had 120,068 active businesses, and the following month, it rose to 120,148, the highest number seen in the last 4 years. That’s still nearly 300 more businesses than we saw this past January.
Plus, the number of active businesses was already declining for months before the pandemic-fuelled recession kicked in. Between January 2019 and January 2020, Alberta had gone from 119,718 active businesses to 118,991.
So, although the pandemic played a huge role in the massive drop we saw during the UCP’s first year or so in power, it wasn’t the only factor.
Even so, the fact that Alberta has seen the smallest gain in active businesses in the country is notable, given that June 2019 was the month after the UCP implemented the Job Creation Tax Cut.
When the UCP announced that they’d cut the tax on corporate profits, they promised that it would result in more jobs, that it would encourage companies to move here.
But if other provinces with much larger corporate profit tax rates are seeing larger gains than we are, can we really say that the tax cut accomplished what they promised us it would?