Recently, Statistics Canada released new data on businesses openings and closures in the country, and I figured I’d take a look at how things look for Alberta.
The data is current only up to April 2022, however, so the current circumstances may differ.
According to the data, Alberta had 117,965 active businesses in April 2022. The month before, that number was 117,842. That’s an increase of 123, or 0.1%.
This is good news for Alberta, given that we saw the number of active businesses drop from 116,993 in November 2021.
In fact, April 2022’s numbers are the second highest they’ve been since before the pandemic began.
However, when we go beyond the pandemic, things look less impressive.
For example, in February 2020, the month before the Alberta government implemented public health protections related to the COVID-19 pandemic, the number of active businesses apparently sat at 119,072. That’s 1,107 more than what we saw in April 2022.
So, while the number of active businesses seems to have surpassed pandemic levels, it’s still below pre-pandemic levels.
Now, some people might think, “Well, of course the number of businesses will be lower. COVID-19 shut everything down and put people out of business.”
There’s something about that.
Here are the number of active businesses every month since April 2019, the month when the UCP won the last provincial election.
Let me show you everything prior to March 2020, which sort of skews the rest of the graph.
Now can you see it?
Even though the number of active businesses definitely dropped after public health protections were put in place, the number had already been declining for several months.
The number of active businesses climbed during the first half of 2019, but after July 2019—the month the UCP implemented their Job Creation Tax Cut—the number of active businesses began to fall.
By October, that number was already below where it was at the start of the year, and by the following February, Alberta had lost over 1,044 active businesses.
And when we compare the 120,118 active businesses Alberta had the month the UCP were elected to the 117,965 still open this past April, we find a net loss of 2,151 since the UCP won the provincial election .
So, while the pandemic definitely reduced the number of active businesses in the province, that number was already on its way down. The pandemic disguised that decline.
Of course, your next question might be, “Well, didn’t the same thing happen in other provinces?”
I’m glad you asked.
In April 2022, the number of active businesses in Alberta accounted for 12.78% of active businesses in Canada. Three years earlier, in April 2019, Alberta accounted for 13.28% of Canada’s active businesses.
Even if the rest of Canada had lost active businesses during those same 3 years, Alberta would’ve had to lose them at a greater rate to now make up a lower percentage of them nationally.
Not only that, but check out the percentage of national businesses in this chart below.
The number of active businesses in Alberta—as a percentage of national businesses—actually increased during the early months of the pandemic.
It was short-lived, however, and by that summer, it was gone. Even so, the overall trend over the last three years has been a downward one.
To be fair, this decline was happening under the Alberta NDP, too.
The data goes back to only January 2015, which is just before the NDP took power, and it looked like it was already on the decline. Without older data, it’s difficult to say if this is something specific to the NDP and UCP or part of a longer trend.
What we do know is that despite promises that a 33% cut to the corporate profit tax rate would lead to more companies moving to Alberta, it doesn’t seem as though the UCP have been able to stop this decline, let alone reverse it.
On that note, it seemed as though the pandemic did a better job of it than the UCP did.