Canada's Small Business Crisis Is Real — And It's Hitting Newcomers the Hardest
If you've been paying attention to the news lately, you've probably noticed that things aren't exactly rosy on Main Street.
Learn More at Job SkillsThe Reality for Small Business
Canada is facing an entrepreneurial drought
The Canadian Federation of Independent Business (CFIB) just dropped a report in April 2026 called Canada's Entrepreneurial Drought, and the numbers are pretty sobering.
For six consecutive quarters — that's a year and a half — more businesses have closed in Canada than have opened. Exit rates hit as high as 5.6% in mid-2025, while new business entry rates dropped to around 4.8% by late 2025.
The CFIB isn't mincing words here: they're calling it an "entrepreneurial drought," and the data backs it up.
What’s Driving It?
A perfect storm for entrepreneurs
High costs. Endless red tape — we're talking hundreds of hours a year in compliance work for some SMEs. Labour shortages. Supply chain headaches. And an overall sense of economic uncertainty that's made a lot of people think twice before taking the leap.
of small and medium-sized business owners say they wouldn't recommend starting a business right now.
of SME owners say they don't have faith in the federal government to help them out.
feel just as unsupported at the provincial level.
So it's not just the market conditions that are discouraging people. It's the feeling that nobody's in their corner.
Where Newcomers Fit In
Starting from scratch makes the barriers even higher
If you're a newcomer who arrived here with a dream of running your own business, you're walking into this environment without the networks, the local market knowledge, or the established credit history that most long-time residents take for granted.
The barriers that already exist for every aspiring entrepreneur in Canada are amplified when you're starting from scratch in a new country.
And yet, the entrepreneurial spirit among newcomers to Canada is extraordinary. The ambition is there. The work ethic is there. The experience is often there, too.
What's sometimes missing is the roadmap.
Canada's small business environment is tough right now, no question. But "tough" doesn't mean "impossible" — and it definitely doesn't mean you have to figure it out alone.
How Job Skills Can Help
Self-Employment Pathways gives newcomers a practical roadmap
That's exactly what Job Skills is here to help with. Through its Self-Employment Pathways program, Job Skills works with newcomers in York Region and the Greater Toronto Area to cut through the noise — offering practical, hands-on support that takes you from idea to launch.
We're talking real guidance on business planning, market research, financials, and how to navigate the Canadian business landscape as someone who's new to it.
This isn't a generic program with a pamphlet and a handshake. It's structured support designed specifically for people who need to build their foundation here from the ground up.
If you're a newcomer with a business idea and you're not sure where to start, let's talk.
Learn more about Self-Employment Pathways for Newcomers at Job Skills.
Learn More Contact Job SkillsFrequently Asked Questions
Answers for newcomers interested in starting a business in Canada and learning how Job Skills can help.
1. Why is Canada’s small business environment considered challenging right now?
Canada is experiencing what the CFIB has called an “entrepreneurial drought,” with more businesses closing than opening for six consecutive quarters. High costs, red tape, labour shortages, supply chain issues, and economic uncertainty are making it harder for entrepreneurs to start and sustain businesses.
2. What does “entrepreneurial drought” mean?
It refers to a period where business creation slows down and business closures rise. In this case, Canada has seen more businesses exiting than entering the market, creating concern for the future of small business growth.
3. Why are newcomers especially affected by these challenges?
Newcomers often face the same barriers as other entrepreneurs, but without established local networks, Canadian market knowledge, or a long credit history. This can make starting a business in Canada more difficult without the right guidance and support.
4. Do newcomers still have opportunities to start businesses in Canada?
Yes. While the environment is difficult, it is not impossible. Many newcomers bring strong ambition, work ethic, professional experience, and entrepreneurial drive. With a clear roadmap and practical support, business ownership can still be achievable.
5. What kind of support do newcomer entrepreneurs need most?
Many newcomer entrepreneurs benefit from support with business planning, market research, financial preparation, understanding Canadian business expectations, and navigating local systems, regulations, and opportunities.
6. What is Job Skills’ Self-Employment Pathways program?
Self-Employment Pathways is a Job Skills program designed to help newcomers in York Region and the Greater Toronto Area move from business idea to launch with structured, practical, hands-on support.
7. What topics does the Self-Employment Pathways program help with?
The program provides guidance on business planning, market research, financials, and understanding how to navigate the Canadian business landscape as someone who is new to it.
8. Is the program only for people who already have a completed business plan?
No. The blog speaks directly to newcomers who have a business idea but are not sure where to start. The program is designed to help participants build a stronger foundation from the ground up.
9. Who does Job Skills support through this program?
Job Skills supports newcomers in York Region and the Greater Toronto Area who are interested in self-employment and want practical help turning a business idea into a launch-ready plan.
10. How can I learn more or get started?
You can learn more by visiting the Self-Employment Pathways for Newcomers page or contacting Job Skills directly.
