The EY G20 Entrepreneurship Barometer 2013: Canada
The power of three: governments, entrepreneurs and corporations
Entrepreneurs take center stage.
Canadian entrepreneurs have much to be thankful for. They operate in an environment that is highly supportive of their activities. The cost of starting a business in the country is among the lowest in the G20, while entrepreneurs spend fewer hours on their tax affairs than their peers in most other nations, enjoy lower labor costs and benefit from better access to funding. As a result, levels of new business activity and start-ups are well above the G20 average.
However, given this relatively benign backdrop, entrepreneurs in Canada are notably less positive than might be expected. For example, 73% of entrepreneurs from Canada say access to funding remains difficult, above the G20 average as a whole. Similarly, while Canada has the lowest insolvency costs in the G20, 36% of local entrepreneurs say business failure is a barrier to future business ventures, also above the overall average.
This mismatch may reflect Canadian entrepreneurs’ higher expectations. In a generally conducive environment, they may expect greater levels of assistance and support and could be prone to disappointment during tougher times, such as those seen since the financial crisis. Nevertheless, these concerns will need to be met in order to avoid disillusionment with entrepreneurship. Canada already scores below the mature economies’ average on perceptions of entrepreneurship as a career choice: it would be a mistake to let such sentiments outweigh the country’s many entrepreneurial upsides.
Overall, though, Canada is one of the top performers in the EY G20 Entrepreneurship Barometer 2013, scoring consistently high in nearly all categories of the entrepreneurial environment. Only on coordinated support does it register a below-average performance, based on local entrepreneur sentiment — and this is in common with other mature countries surveyed. Looking ahead, all these strengths should support growing levels of new business creation, with one report predicting the net creation of 150,000 new businesses in the coming decade — a resounding endorsement for Canada’s entrepreneurial ecosystem.1
1. B Tal, Start-ups — Present and Future (CIBC World Markets Inc., 2012).