As the pandemic recedes, the next couple of years will offer a “once-in-a-lifetime” opportunity for Canada’s small businesses to rebound and innovate, says a new report from Scotiabank Economics.
Small and medium-sized businesses (SMEs) represent a large share of overall economic activity in Canada, and they account for the vast majority of private sector employment. While these kinds of firms were hit hard by the pandemic, Scotia said, “the second half of 2021 and 2022 should bring growth opportunities to SMEs, with the strongest economic expansion in decades, continued fiscal support measures and accelerated adoption of new technologies.”
Currently, supply-chain disruptions and labour shortages are weighing on economic growth, but Scotiabank said it expects those constraints to ease over the next couple of years.
It said supply issues will “gradually improve” in 2022, and that government efforts to renew immigration should help address worker shortages.
Against this backdrop, and despite the possible re-emergence of virus waves, “the next few years present a once-in-a-lifetime opportunity for SMEs to rebuild and grow their business, expand into new markets, develop new products and in general position their firms for long-term success,” the report said.
Taking advantage of this opportunity “will require entrepreneurs to remain nimble and take risks,” the report said. “It will also require resilience, as the road ahead is likely to be bumpy, even as the trend is clearly up.”
“Stars are aligning for better days beyond Covid-19,” the report concluded. “With strong growth in Canada and the U.S. anticipated in the short term, and — in the medium term — accelerated adoption of new technologies, rising immigration and continued fiscal support, SMEs should enjoy plenty of opportunities not only to recover to pre-pandemic levels, but to thrive and continue to succeed in the competitive global environment.”