Self-employed individuals, many of home run small businesses have seen their personal finances deteriorate during the pandemic according to the BDO Affordability Index

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Self-employed individuals, many of home run small businesses have seen their personal finances deteriorate during the pandemic according to the BDO Affordability Index

As the COVID-19 pandemic rages on, so does the impact Canadians are feeling due to economic changes, job loss, and major disruptions across all sectors of the economy. This point was further driven home on October 14, 2020 when BDO released their Annual Affordability Index, with data collected and analyzed by Angus Reid.

The report shows what many other sources have noticed or remarked on since March when the economic shutdown began, the Canadians taking the hit from COVID-19 are taking it hard. If you were struggling before the pandemic, it’s not likely your situation got better. But if you in a strong financial position in 2019, you likely don’t share the same anxiety as the majority of Canadians stressed about their personal finances. In Ontario alone, 40 percent of respondents say they are worse off than a year ago, however, 19 percent feel they’re in a stronger financial position.

What is striking for the business community is the number of self-employed individuals, many of home run small businesses, who have seen their personal finances deteriorate. The study indicates 60 per cent of self-employed individuals are in a more tenuous situation.

According to Andre Bolduc, Senior Vice President and Licensed Insolvency Trustee, the stress on self-employed and small and medium businesses hasn’t been felt evenly. If a business relied on a store-front and had a minimal online presence before covid-19, they’ve probably had a hard year. (Expand your online presence with these supports and grants) Businesses with high rent who experience a drastic decline in income are also in a less economically certain position.

One thing Bolduc notes that has helped some businesses close to the brink, is court closures. Debt collection and eviction tribunals have been put on hiatus, and this has provided a buffer for some small businesses to get by during the last few months.

“What’s going on is a great pause,” Bolduc said. “Will we go back to how it was before? I don’t know, and I doubt it, but the situation will improve somehow.”

With wage subsidy programs and expense support programs offered at the federal level, amongst other forms of support, Bolduc feels that the federal and provincial response to supporting Canadians has been adequate. The national debt is now exponentially higher than 5 or 10 years ago, with an unprecedented level of spending from Ottawa.

“Could they have done things a bit better, maybe, but they had to act quick,” said Bolduc. “They have done a lot to help Canadians, and I’m not sure there is really more left for them to do in terms of spending.”

With Government support exhausted, savings depleted and overall trends in spending either declining or shifting, the future looks fairly grim for many entrepreneurs. Bolduc stresses that if you’re uncertain of your situation, seek out advice from a LIT. Speaking to an LIT is free, and strictly informational for your first visit. There are many options and paths to more stable finances, and just because a business owner or individuals needs advice, it doesn’t mean they’re on a path to bankruptcy.

“We know money is very personal for people, but debt anxiety is a real thing. We want to stress we are non-judgemental. Our goal is to help,” said Bolduc.

Many self-employed and small business owners finance their operations through personal accounts and lines of credit, and those lifelines have been crucial as the pandemic has progressed. Ensuring your situation is sustainable beyond what Bolduc calls the “Great Pause” is a positive first step towards an eventual recovery. The only thing we can expect as we move forward is more uncertainty, and that means the business community needs to ensure that they have the ability to foster stable growth when the opportunities return in full, or in part. Having an uncomfortable conversation with a professional today will help many entrepreneurs not only survive COVID-19 but thrive in the post-pandemic economy.

Quick Facts

  • Prior to January 2020, small businesses made up 97.9 per cent of all business in Canada, employing over 11 million Canadians.
  • Since the COVID-19 pandemic reached Canada earlier in 2020, 2 out of 5 Canadians say their economic situation has worsened.
  • Younger Canadians (under the age of 50) are more likely to prioritize paying down debt instead of saving for retirement.
  • 64% of Canadians have personal debt, of that percentage a quarter of Canadians can not maintain their lifestyle and make their payments.


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The Cornwall and Area Chamber of Commerce is the largest organization representing business interested in eastern Ontario. With a membership of over 500 local businesses, the Chamber seeks to develop and maintain a fertile entrepreneurial ecosystem. Our extensive network of local companies culminates in the capacity to influence, proving that we are stronger together. To create this ecosystem, we leverage leadership, creativity and collaboration. We focus on advocacy and provide helpful tools and connections for business owners to expand, compete, and promote.

Marc Benoit
Author: Marc Benoit

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