50,000 Businesses Closed In One Month: The End of Small Business in Canada

Hudson's Bay has been a staple in Canada

for centuries.

>> I think it's really sad cuz it's so old.

It's just been around for so long. It's

kind of an iconic Canadian brand.

>> It's a retail brand steeped in nostalgia

for generations of Canadian kids.

>> We used to get all of our toys as a kid

from Toys R Us. It wasn't really other

places to get them from, right?

>> But times have definitely changed. Those

former Toys R Us kids no longer have

many places to shop. They say the

economy is growing, but when you drive

through your community or even to the

one next door, does it actually look

like that? So, the next time you head

out, run a simple test. Drive down the

main commercial strip, walk past that

plaza where you used to grab a pizza on

Friday nights, and take a lap around

your local mall or strip plaza, if it's

even still open. And what do you see?

papered over windows for lease signs

that have probably been hanging there

for months. Parking lots half empty on a

Saturday afternoon. Well, since we're

talking about restaurants, Ontario has

the largest restaurant industry in

Canada with over 41,900

establishments and close to a half a

million employees. They report that

sales are up. The headlines say growth

is strong. Yet more than half of the

restaurants reported that they are not

profitable because costs are climbing,

menu prices have jumped roughly 13% and

staff shortages are constant. So yes,

revenue may be rising but survival, well

that's another story. The place that

once felt like the heartbeat of your

community are quietly disappearing and

it's very unsettling. You you feel it in

your gut like something just doesn't add

up. It feels very eerie out there. Then

you obviously turn on the news and of

course it's the same scripted lines. The

economy is resilient. The labor market

is strong. Canada is growing. And then

you start to question yourself. Why does

your town or city feel like it's slowly

shutting down? Why is your favorite

bakery closing? Why does everyone you

know feel stretched to the limit?

Sometimes the numbers tell one story,

but see your own eyes will tell another.

The eye test is always right. What we

are witnessing is the slow, painful

extinction of the Canadian small

business. The private sector, the engine

that actually pays for our hospitals and

schools, is sputtering. And today, I

will show you the reports. So, we're

going to connect the dots between empty

storefronts, shrinking paychecks, and a

government sector that keeps expanding

while the productive economy contracts.

Okay, so let's get into the evidence.

So, let's start with jobs. If people

don't have good jobs, they don't spend

money. If they don't spend money, small

businesses die. Very elementary. And

it's very that and it's just that

simple. You'll hear headlines about jobs

being added, but when you look closer,

payroll employment from December 2024 to

December 2025 are down 28,300

jobs. That's not an abstract. That's

thousands of families who went from

stable, predictable incomes to

uncertainty. And remember, payroll

employment isn't gig work. It's not your

side hustles. It's steady T4 mortgage

qualifying income. So in a year when we

added over a million people to this

country, we lost stable jobs, more

people, fewer steady jobs. That's not

economic strength, that is clearly

dilution. And even if you keep your job,

are you actually getting ahead? Because

when you look at wage growth versus core

inflation, well, our wages are trying to

catch up. Now they've crossed back under

inflation. That's the silent pay cut.

You get a 2% raise, but your rent goes

up to 8%, your insurance climbs to 10%,

your groceries climb up again, gas is up

again. On paper, you got a raise, but in

reality, I'm sorry, you're actually

poor. That blue line crossing below the

red line, that's purchasing power

evaporating.

That's the family that you seat out

twice a week, cutting it back down to

possibly once a week or maybe once a

month. And your kids hockey registration

is now becoming a maybe next year.

That's the gym membership that you

canled quietly. Small businesses don't

fail because people hate them. They're

closing because consumers are forced to

choose between survival over spending.

Now, let's talk about making things. A

healthy economy produces. You can't just

trade homes back and forth forever. You

need an industry. Manufacturing output,

shipments, employment, all have all been

trending down since 2023.

We've effectively been in a

manufacturing recession for nearly 2

years. Over 40,000 manufacturing jobs

lost in a single year. These are good

jobs, skilled trades, union roles, jobs

that supported mortgages and families.

They're disappearing.

And look deeper at that sector breakdown

chart. Goods producing industries like

manufacturing, wholesale, transport,

they're all showing negative. These are

the arteries of a functioning economy.

So if trucks aren't moving, if factories

aren't humming, if suppliers aren't

shipping, that's not a soft patch.

That's the economy pulling back.

Meanwhile, public administration is

showing a positive. Now, let's pause

here for a second because see, public

administration doesn't generate exports.

It doesn't create tradable goods. It's

funded by tax revenue that comes from

the productive side of the economy. So,

when we see goods producing sectors

shrinking while government payrolls

expand, that's not neutral. This is a

temporary wobble. It's a fundamental

imbalance. It's like loading more

passengers onto one side of the boat

while the motor is quietly losing power.

Now, let's talk about small business

owners. When asked what's stopping them

from growing, the top answer is

financial situation. Otherwise, that's a

polite way of saying cash flow is tight.

Then there's labor shortages, then

taxes, then rising operational costs.

Imagine running a restaurant where food

costs are up, your rent is up, your

wages are up, insurance is up, but your

customers are spending less because

their real wages are down. See, this

isn't mismanagement. It's margin

compression. It's a fullblown squeeze.

Here's the chart that should concern

everyone. Total active businesses look

flat, but when they remove health and

education, the statebacked sectors, the

private sector has flatlined since 2020.

We're talking about retail, tech,

construction, hospitality. As you see,

there is no real growth. The only reason

the total line looks stable here is

because government funded sectors are

expanding. And that isn't balance. It's

a structural imbalance where one side

feeds the other and the feeder is

getting weaker. When tax producing small

and midsize businesses stall, government

revenues don't magically grow on

optimism. They rely on profitability,

payrolls, and consumer activity. And if

those slow down while public

expenditures expand, the gap doesn't

disappear. It widens. And that's not

equilibrium. It's increasing dependency

on a shrinking engine. And the closures

at recent peaks, we saw roughly 45,000

to 50,000 businesses shutting their

doors in a single month. That's not

normal business turnover. That's a

stress surfacing in real time. Behind

each closure is payroll lost, unpaid

rent, suppliers impacted, communities

hollowed out. You don't lose that many

businesses in a healthy expansion. Yes,

of course, in a healthy economy, that's

a normal turnover. That's competition.

That's innovation replacing what no

longer works. But see, when closures

surge into the tens of thousands in a

single month while private sector growth

flatlines, that is not normal turnover.

That isn't creative renewal. That's

attrition. It's your local dry cleaner

locking their doors, your corner cafe

going dark, your independent bookstore

clearing the shelves for good. And

that's not the market evolving. That's

the foundation thinning out and

unfortunately gone forever. And when

small businesses disappear, the ripple

spreads. Your local accountant loses a

client, the sign company loses a

contract, the cleaning service loses its

reoccurring revenue, and it just

cascades from there. Now, let's look at

Yorkdale as an example. Major anchors

like HC are gone. Big brands are

shrinking or pulling out altogether. So,

when an anchor leaves, foot traffic

drops. When foot traffic drops, smaller

tenants struggle, vacancies clearly

rise, and landlords start offering

incentives, rents soften, property

values adjust downward, municipal tax

base weakens, and when commercial tax

revenue falls, the shortfall doesn't

vanish. It needs to shift, often onto

residential homeowners. So, even if

you've never owned a store, this

actually touches you. Retail plazas turn

into storage facilities. I'm starting to

see a lot of that where I live.

Warehouses, condos, some redevelopment

is productive. But when community space

disappears faster than it's replaced

with something dynamic, the neighborhood

changes. Character drives desiraability.

Desiraability drives price. Real estate

doesn't lead the economy. It always

follows it. It follows employment

stability. It follows income growth. It

follows whether a town feels vibrant or

like it's fading. Low inventory can mask

weakness for a while. Population growth

can prop it up temporarily. But see,

long-term property values rest on

productivity. We don't just lose

storefronts, we lose momentum. And when

momentum slows, real estate eventually

reflects it. So where does this head?

Well, it leads to three realistic paths.

The first one, the government and large

corporations expand further. While small

businesses continued to disappear, fewer

local employers, fewer independent

operators, fewer choices. Second,

younger skilled workers look at their

wages, taxes, and cost of living, and

they'll probably build their futures

somewhere else. Third, we course

correct. We reduce the cost of doing

business. We prioritize production. We

rebalance before erosion sets in.

Economic decline rarely arrives all at

once. It's gradual. One store closes,

then a few more. A plaza looks half

empty. A mall shuts down. And

eventually, people ask, "How do we get

here?" When small businesses disappear,

communities change,

competition shrinks, personality fades,

uniqueness erodess, and when ownership

concentrates into the fewer hands,

opportunity narrows. That affects jobs,

that affects property values, that

affects the kind of future the next

generation inherits. Real estate isn't

real estate isn't insulated. It follows

jobs. It follows income. It follows

whether a town feels alive or uncertain.

The data points in one direction. The

storefronts tell the same story. The one

real question is whether we are paying

attention or not. I don't know guys. Let

me know what you're seeing where you

live. Are stores closing? Are the malls

quieter than they used to be? And if you

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Thanks for watching, guys, and I'll see

you in the next one.