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How many businesses are there in Canada?

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The Business Register of Statistics Canada maintains a count of business establishments¹ and publishes results twice a year. Business establishments can belong to the same company; each company owns at least one business establishment. For an individual business establishment to be included in the Business Register, the company to which it belongs must meet at least one of the following minimum criteria: it must have at least one paid employee (with payroll deductions remitted to the Canada Revenue Agency (CRA)), it must have annual sales revenues of $30 000, or it must be incorporated and have filed a federal corporate income tax return at least once in the previous three years.

As of June 2007, there were more than 2.4 million business establishments² in Canada, as shown in Table 1, compared with 2.3 million establishments in June 2006. However, this is down slightly from June 2006. About half of all business establishments are called “employer businesses” because they maintain a payroll of at least one person (possibly the owner). The other half are classified as "indeterminate" because they do not have any employees registered with the CRA. Such businesses may indeed have no workforce (they may simply be paper entities that nonetheless meet one of the criteria for recognition as a business establishment) or they may have contract workers, family members and/or only the owners working for them. The "indeterminate" category was created because information about their workforce is not available.

Approximately 58 percent of all business establishments in Canada are located in Ontario and Quebec. Virtually all the rest are divided between the western provinces (36 percent) and the Atlantic provinces (6 percent). The Northwest Territories, Yukon and Nunavut represent only 0.3 percent of Canada's businesses.

Table 1: Total Number of Business Establishments, and Number of Establishments Relative to Provincial/Territorial Population and Gross Domestic Product, June 2007
Provinces/Territories	No. of Business Establishments			No. of Establishments per 1000 Population	GDP per Business Establishment ($ thousands)
Provinces/Territories	Total	Employer Businesses	Indeterminate¹	No. of Establishments per 1000 Population	GDP per Business Establishment ($ thousands)
Newfoundland and Labrador	26 207	17 051	9 156	51.7	950
Prince Edward Island	11 152	6 386	4 766	80.3	388
Nova Scotia	57 070	30 916	26 154	61.2	560
New Brunswick	44 154	26 387	17 767	59.0	571
Quebec	482 796	236 584	246 212	62.8	589
Ontario	904 765	365 417	539 348	70.9	615
Manitoba	79 149	36 404	42 745	66.9	565
Saskatchewan	97 990	39 121	58 869	99.0	460
Alberta	332 931	153 604	179 327	96.4	708
British Columbia	362 642	170 707	191 935	83.3	496
Yukon Territory	2 940	1 610	1 330	95.2	543
Northwest Territories	2 768	1 676	1 092	66.2	1 482
Nunavut	891	624	267	28.5	1 361
Canada Total	2 405 455	1 086 487	1 318 968	73.2	598

Source: Statistics Canada, Business Register, June 2007; National Income and Expenditure Accounts 2006; Estimates of Population by Age and Gender for Canada, the Provinces and the Territories, June 2007.

Note 1: The "indeterminate" category consists of incorporated or unincorporated businesses that do not have a Canada Revenue Agency payroll deductions account. The workforce of such businesses may consist of contract workers, family members and/or owners.

Relative to population, the western provinces, Yukon and Prince Edward Island have more business establishments than elsewhere, with the highest rates in Saskatchewan and Alberta at 99.0 and 96.4 per 1000 population respectively. Nunavut, Newfoundland and Labrador, Nova Scotia and New Brunswick have the lowest ratios of business establishments per 1000 population. Ontario and Quebec are below the national average of 73.2, with 70.9 and 62.8 business establishments per 1000 population respectively.

In terms of gross domestic product (GDP) per business establishment by province, the Northwest Territories shows the highest ratio at $1 482 000 per establishment. (This is likely due, in part, to the low number of establishments per 1000 residents; therefore, its GDP is spread over fewer establishments.) More broadly, there is a noticeable negative relationship between the number of establishments per 1000 inhabitants and contribution to GDP per establishment in that a higher number of establishments per 1000 population corresponds to a lower GDP per establishment. Alberta is an exception to this rule, with a relatively high GDP per establishment as well as a high number of establishments per 1000 residents.

Of the 1 086 487 employer businesses, 3250 or about 0.3 percent have 500 employees or more. The vast majority of employer businesses (98 percent) have fewer than 100 employees, 75 percent have fewer than 10 employees and 58 percent have only 1 to 4 employees (see Table 2).

Table 2: Number of Business Establishments by Sector and Firm Size (Number of Employees), June 2007
Number of Employees	Cumulative Percent of Employer Businesses	No. of Business Establishments
Number of Employees	Cumulative Percent of Employer Businesses	Total	Goods-Producing Sector²	Service-Producing Sector²
Indeterminate¹		1 318 968	345 217	973 751
Employer Business Total	100.0	1 086 487	251 155	835 332
1–4	58.4	634 927	157 812	477 115
5–9	74.8	178 012	34 829	143 183
10–19	86.3	124 301	24 222	100 079
20–49	94.6	90 458	19 053	71 405
50–99	97.5	32 045	7 936	24 109
100–199	99.0	15 571	4 333	11 238
200–499	99.7	7 923	2 272	5 651
500+	100.0	3 250	698	2 552
Grand Total		2 405 455	596 372	1 809 083

Source: Statistics Canada, Business Register, June 2007.

Note 1: The "indeterminate" category consists of incorporated or unincorporated businesses that do not have a Canada Revenue Agency payroll deductions account. The workforce of such businesses may consist of contract workers, family members and/or owners.

Note 2: By conventional Statistics Canada definition, the goods-producing sector consists of North American Industry Classification System (NAICS) codes 11 to 31–33, while NAICS codes 41 to 91 define the service-producing sector.

About one quarter of all business establishments (indeterminate and employer businesses alike) produce goods, whereas the remainder provide services. Small firms (those with fewer than 100 employees) make up 97 percent of goods-producing employer businesses and 98 percent of all service-producing employer businesses (Table 2). Using an alternative definition of small businesses in the service-producing sector that defines small businesses as those with fewer than 50 employees, small firms account for 95 percent of all service-producing employer firms.

Source: Statistics Canada, Business Register, June 2007.

Note 1: By conventional Statistics Canada definition, the goods-producing sector consists of North American Industry Classification System (NAICS) codes 11 to 31–33, while NAICS codes 41 to 91 define the service-producing sector.

Note 2: The "indeterminate" category consists of incorporated or unincorporated businesses that do not have a Canada Revenue Agency payroll deductions account. The workforce of such businesses may consist of contract workers, family members and/or owners.

Table 3 shows the distribution of employer businesses by size of business establishment in each province and territory. Generally speaking, the distribution by size in the provinces is similar to the national average distribution by size. However, there is some variation among the provinces and territories; for example, there is a higher percentage of micro-enterprises (1 to 4 employees) in Quebec (66 percent) and Newfoundland and Labrador (60 percent) than in Ontario (55 percent), Manitoba (52 percent) or the territories (from 30 percent to 52 percent).

Table 3: Employer Businesses by Firm Size (Number of Employees) in the Provinces and Territories, June 2007
Provinces/Territories	Employer Businesses
	Total	Percent of Total
	Total	1–4	5–9	10–19	20–49	50–99	Small <100	100–199	200–499	Medium 100–499	Large 500+
Newfoundland and Labrador	17 051	60.3	18.0	10.2	7.3	2.1	98.0	1.0	0.6	1.6	0.3
Prince Edward Island	6 386	57.7	18.0	11.9	8.1	2.6	98.2	1.0	0.5	1.6	0.2
Nova Scotia	30 916	56.9	17.7	11.7	8.6	2.8	97.7	1.4	0.6	2.0	0.3
New Brunswick	26 387	59.8	16.8	11.2	7.8	2.5	98.1	1.2	0.5	1.7	0.2
Quebec	236 584	65.8	14.6	9.2	6.3	2.2	98.1	1.1	0.5	1.6	0.3
Ontario	365 417	55.2	16.6	12.3	9.4	3.5	97.0	1.7	0.9	2.6	0.4
Manitoba	36 404	52.3	18.0	13.5	10.2	3.3	97.3	1.5	0.8	2.4	0.3
Saskatchewan	39 121	57.1	17.7	12.4	8.4	2.6	98.2	1.0	0.5	1.6	0.2
Alberta	153 604	56.6	16.8	11.9	8.8	3.2	97.2	1.7	0.9	2.5	0.3
British Columbia	170 707	58.8	16.8	11.6	8.0	2.7	97.9	1.2	0.6	1.8	0.2
Yukon Territory	1 610	52.2	17.9	14.4	10.6	3.1	98.1	0.9	0.8	1.7	0.1
Northwest Territories	1 676	38.5	20.4	18.9	14.4	4.8	97.0	2.0	0.9	2.9	0.2
Nunavut	624	29.5	21.5	22.3	18.9	5.4	97.6	1.8	0.5	2.2	0.2
Canada Total	1 086 487	58.4	16.4	11.4	8.3	2.9	97.5	1.4	0.7	2.2	0.3

Source: Statistics Canada, Business Register, June 2007.

1. Statistics Canada uses four standard business units for purposes of compiling statistics. Establishments are the smallest unit/ grouping for which data are published. Establishments must:
a) produce a homogeneous set of goods or services;
b) not cross provincial boundaries; and
c) provide data on the value of output together with the cost of principal intermediate inputs used, along with the cost and quantity of labour resources used to produce the output.

For example, a business unit of a larger enterprise that provides independent accounting information to the government on sales taxes and payroll deductions would be recognized as an individual business establishment.

2. This number includes both commercial and non-commercial business establishments.

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