The business community is in a time of rapid change. We’re now getting a better picture of just what has changed.
The Canadian Chamber of Commerce, Employment and Social Development Canada (ESDC), and Palette Inc. partnered with the Brookfield Institute for Innovation + Entrepreneurship (BII+E) to analyse business trends throughout the course of the pandemic using Statistics Canada’s Canadian Survey on Business Conditions, which includes feedback from 15,400 businesses.
The finance and insurance industry is leading the way in online sales with 20% of businesses in this industry reporting that 60% or more of their sales are online. As a whole, 9% of Canadian business report making 60% or more of their sales online in 2020, up from 6% in 2019. On the other end of the
online sales spectrum, the number of businesses in
Canada making less than 1% of their sales online
decreased from 83% to 78%.
Only 7% of retailers report making 60% or more of their sales online, up from 5% in 2019. Despite this, online sales as a whole increased from 3.5% to 5.9% of total retail sales in 2020. Just the month of December, a key time for
retail, saw an increase of 69.3% in online sales.
There is a lot to unpack from all of this. The shift to online takes more than a willingness to adapt. While businesses with 1 – 4 employees make up a significant number of online retailers, the study finds a direct correlation between those currently adapting and the size of the business. Bigger businesses have more ability to plan and adapt than a smaller
operation where owners and staff have a much wider range of roles and
expectations. Businesses that have been more able to adapt to remote work, like finance and insurance, have adapted faster to
selling online. Other
industries, like arts and entertainment, have been leaders in online sales, but have struggled through the pandemic due to restrictions on their ability to provide their product.
It’s no surprise that
businesses that have been able to shift to working at home are better positioned to weather the pandemic and the resulting health
employment fell by 213,000 in January 2021 while the number of people working from home increased by nearly 700,000. Most of the job losses were focused on sectors with less ability to work remotely.
Again, larger businesses had an easier time adapting to the shift to remote work as they tend to have more resources to create flexible work
arrangements. More than 70% of firms in professional, scientific, and technical
services, finance and
insurance, and information and cultural industries
reported that remote work was a possibility.
This has implications on physical business locations as 8% of businesses report that it’s likely they will reduce their physical space after the pandemic. Businesses also report an increase in plans to hire employees outside their region.
The impact of COVID-19 on the labour market is still evolving. Millions of workers have suffered job loss and unemployment numbers
continue to fluctuate. Yet one fifth of Canadian businesses expect to face labour shortage
issues in the next three months. This rises to nearly a third for businesses with more than 20 employees.
In the first quarter of 2021, 9% of businesses across Canada stated that over the next year they plan to hire staff with skills or knowledge that their current employees lack. A larger proportion of businesses have plans to train existing employees for new skills compared to those planning to hire new employees with different skill sets, suggesting a stronger inclination towards upskilling the existing workforce rather than looking elsewhere for new talent.
Again, larger businesses are more likely to see an increase in the number of employees over the next 3 months.
Where is this taking us?
The shift is here to stay. 17% of businesses report it is likely they will continue to provide remote work options.
Businesses working on plans to shift more sales online aren’t planning to slow that momentum when this pandemic is over. The skills businesses are looking for are skills they need to continue this shift.
It’s also evident that smaller businesses have to work harder than their larger counterparts to keep up, especially in our hardest hit sectors. As we move forward, we need to make sure the supports are there for small and medium-sized enterprises to thrive and succeed in this shift. We’ll eventually get through this pandemic, but online sales, remote work, and changing demands for skills aren’t going away.
The Peterborough and the Kawarthas Chamber of Commerce acts as a catalyst to enhance business growth, opportunity, innovation, partnerships and a diverse business community.