As business insolvencies climb to levels not seen since the financial crisis of 2008, they still represent just a fraction of the businesses that close each year
Daryl Ching, a Toronto-based chartered financial analyst, has worked with dozens of small business owners over the years. Some of them, unfortunately, fell on hard times and had to close.
Business insolvencies – when business owners go through the formal process of a bankruptcy or a proposal – have Some of those “closed” businesses may report employees again in the future, but many do not. Statscan counts permanently closed businesses as “exits,” and reports those at a six-month lag because the data are based on tax filings. For July of 2023, the most recent month available, Statscan reported there were 42,010 closings, of which 16,416 were permanent. That same month, only 346 businesses filed for bankruptcy or a proposal.
Not all exits are necessarily bad economic news, as some businesses close because the owner retired or the company was acquired. Statscan does not track the reason for an exit. However, there’s more: Some small business failures show up in what the federal Office of the Superintendent of Bankruptcy calls “consumer bankruptcies,” of which there were 33,885 in the first quarter of this year .
Insolvency Debt Quarter Businesses Bankruptcy Statscan Restructuring CRA Statistics Canada David Lewis
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