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 October 2022, so keep that in mind.
First, here’s the number of active businesses in each province, as of October 2022.
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.
|Sep 2022||Oct 2022||Change||% change|
Between September and October 2022, every province but two saw a loss in the total number of active businesses. Alberta, however, saw the third largest decrease in active businesses in the country. The province’s active businesses decreased by 510, from 118,133 to 117,623.
Compare that to the loss of just 27 active businesses just the month before.
Ontario, which was at the bottom of the list, saw over 1,500 fewer active businesses this past October than they did the month before. PEI, actually gained 35 businesses, making it the best performing province in the country
On the other hand, on a percentage basis, Alberta had the fifth largest loss, ahead of Ontario, British Columbia, Nova Scotia, and Newfoundland and Labrador.
Now let’s take a look at how things changed in each province over the past year.
|Oct 2021||Oct 2022||Change||% change|
Alberta gained over 800 active businesses over the past 12 months, the fourth largest increase the country. Ontario topped the list, with nearly 8,300 more active businesses. Québec and BC were in second and third place, respectively, with 3,618 and 1,512 more businesses.
Newfoundland and Labrador was the only province to see its number of active businesses drop over the last year.
Since September 2021, the number of active businesses in Alberta increased by just 0.69%, which drops the province down to the third smallest increase among all provinces.
Of the other provinces, half of them saw increases near or higher than 1% between October 2021 and September October, and two of them were above 2%. The national average was 1.33%, roughly twice as large as the increase Alberta saw.
The story isn’t much better when comparing 2 years.
|Oct 2020||Oct 2022||Change||% change|
Alberta’s increase of 4,925 active businesses over the last 2 years keeps it in 4th place; however, they drop to 7th place on a percentage basis (4.37%), still putting them in the bottom half.
Finally, let’s look at active businesses over the last 3 years:
|Jun 2019||Oct 2022||Change||% change|
I picked June 2019 as the starting point because that was the last month before 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 since the UCP government cut the tax rate on corporate profits, Alberta had the worst performance in the country, losing over 2,400 active businesses.
Only 3 other provinces—New Brunswick, Saskatchewan, and Newfoundland and Labrador—saw a loss in total active businesses, and the next largest loss was 837.
The largest increase was seen in Québec, which has about 7,750 more active businesses than they did in June 2019.
On the plus side, Alberta wasn’t in last place for the percentage of active businesses lost: Newfoundland and Labrador took that honour.b Alberta’s loss of 2.02% of its active businesses over the last 3 years, however, put it in second to last place, on a percentage basis.
Here’s another look at the numbers over the last 3 years.
You can see the huge drop in active business 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 entirely recovery growth.
Plus, the number of active businesses was already declining for months before the pandemic-fuelled recession kicked in.
As well, not only are we still nowhere close to where we were 3 years ago, but it seems like what growth we were making has started to plateau, if not declining again. In other words, we may still be a long way off from even reaching the pre-pandemic numbers, let alone the numbers seen prior to the summer of 2019.
Even so, the fact that Alberta has seen the largest loss 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 were going to be cutting how much they would tax corporate profits, they promised that it would result in more jobs, that it would encourage companies to move here.
But if we have over 2,400 companies shutting their doors, can we really say that the tax cut accomplished what they promised us it would?