With eight recent or upcoming Provincial and Territorial elections across Canada and a new Prime Minister set to call an election in the upcoming months, the next four years present a clear opportunity to start building an economy that truly works for our country’s locally owned small and medium businesses.
Small and medium sized businesses (<250 paid employees) make up 99% of employers in Canada. That’s over 1 million businesses keeping our communities vibrant, creating 7.9 million jobs, and driving innovation. And yet, rents are crushing them, insurance is bleeding them dry, and retiring business owners are having difficulty finding local buyers.
All levels of government have a strong mandate to build a powerful grassroots economy across the province to protect and grow employment beyond 60% of Canada’s workforce and generate more GDP in the face of tariffs from our southern neighbour. But tweaks in our industrial policies won’t cut it. If Canada is serious about economic strength, we need bold action beyond tax cuts.
A Plan for a Stronger Small Business Economy
- Commercial Rent Modernization – Right now, landlords can jack up rents overnight, and small businesses just have to take it. That’s not a free or fair market. Commercial tenants across the country need transparent and standard lease agreementsso small business owners can plan for the future without fear of sudden, cash-depleting rent hikes. They also need a low-cost, rapid pathway to solve lease disputes with their landlord so they can go back to investing in their business, not lawyers. And if landlords are raising rents to exploitative levels “because they can”, thre should be a limit to the price rise to prevent speculation from slashing jobs and incomes for staff and hardworking entrepreneurs.
- NextGen Ownership Fund – Thousands of small business owners are set to retire, and if we’re not careful, their businesses will disappear or get scooped up by faceless corporations. A NextGen Ownership Fund would help entrepreneurs buy and transition these businesses – keeping wealth and decision-making local instead of exporting it to foreign investors and hedge funds.
- Local Ownership Mortgage Program – Too many entrepreneurs rent indefinitely, locked in a cycle where landlords profit off their hard work. Just like residential housing, many viable businesses have been priced out of ownership. A tailored mortgage program would help more small business owners buy their commercial spaces, building equity and security instead of pouring hard-earned money into someone else’s pocket.
- Business Insurance Reform – Adequate small business insurance is extremely difficult to secure at an affordable rate. Without much competition in the market, providers are charging high rates that keep rising and denying claims far too often. Provinces should spur more competition in the insurance sector and ensure regulatory guidelines keep insurance appropriate and affordable for small businesses.
Small Business is Not a Side Project
The usual small business playbook of tax cuts isn’t enough. Small businesses don’t need to save a thousand dollars here or there; they need a playing field that isn’t tilted against them. That means:
- Policies that protect small businesses from exploitative landlords.
- Programs that turn employees into future business owners.
- Structural changes that make small business ownership a pathway to stability, not just survival.
Other countries are getting this right—so we can too. In Singapore, targeted support for small enterprises has strengthened local innovation. South Korea’s Ministry of SMEs and Startups has helped businesses scale while keeping ownership local. Texas’ business-friendly policies have fueled job growth and economic expansion. Canadian jurisdictions can adopt proven strategies that enable small businesses to thrive instead of forcing them to operate in survival mode.
One way to start is by taking inspiration from Canada’s Digital Main Street program. During the pandemic, this initiative helped small businesses modernize through funding e-commerce infrastructure and digital upgrades for small businesses.
A similar model – a $2,400 grant for SMEs to support higher wages tied to a career-development or skills-growth plan – could jump-start workforce investment, giving small business owners the initial capital and confidence to offer better wages, improve retention, and reinvest in local economies.
Even at the smallest of employers, this program could upskill the workforce, increase business revenues, and put wealth into frontline employees’ pockets – circulating cash where it’s needed most. The productivity and business decisions such an investment creates provides SMEs with the future cash flow they need to fund wages and upskilling on an ongoing basis, raising Canada’s overall productivity and worker retention rates.
Our policymakers can also look at how other jurisdictions finance small business growth. Community Development Financial Institutions (CDFIs) in the U.S. provide targeted lending to small businesses that struggle with traditional bank financing. The European Union’s Small Business Act ensures that regulations are designed with small businesses in mind. Poland’s Special Economic Zones offer tax incentives for locally owned businesses. Ontario can integrate these ideas to create an ecosystem where small businesses don’t just survive – they thrive.
Let’s stop managing decline. Let’s start building something stronger.
Learn more about our policy vision for Ontario’s small business ecosystem.