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Printed Feb 26, 2025 • 2 minute learn
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OTTAWA — Corporations owned by newcomers to Canada are inclined to wrestle taking their companies to the following stage greater than Canadian-born founders, new knowledge suggests.
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The report launched by Statistics Canada on Wednesday explores obstacles immigrants to Canada can face when beginning and scaling a enterprise.
One of the crucial vital findings was round labour productiveness — how a lot a person can produce in an hour of labor.
After controlling for elements such because the business and province of labor, StatCan discovered that labour productiveness was 9.4 per cent decrease for majority-owned immigrant companies in comparison with companies run by their Canadian-born counterparts.
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However that hole additionally widens the larger an organization will get, rising to twenty.9 per cent for companies with 100 or extra staff.
Rising productiveness is a crucial issue to assist Canadians get higher wages with out driving up inflation.
However dwindling productiveness charges throughout the Canadian economic system over current years have stirred concern amongst economists, with the Financial institution of Canada ringing the alarm bell in 2024.
How productive an immigrant-owned agency finally ends up being can rely on the proprietor’s enterprise expertise earlier than migration, StatCan mentioned, in addition to their mastery of Canada’s official languages and total training ranges.
StatCan mentioned there have been a number of different elements that might play a task within the productiveness hole, together with monetary constraints that restrict an immigrant proprietor’s capability to put money into higher know-how and instruments for staff.
Immigrant-owned companies might also be extra concentrated in extremely aggressive industries with low margins — assume eating places, small retail retailers or private providers suppliers — the place StatCan famous it’s harder to make the most of economies of scale to spice up productiveness.
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The productiveness evaluation produced an attention-grabbing wrinkle when taking a look at companies with a minority immigrant possession.
For companies beneath 100 staff in dimension, labour productiveness was truly larger amongst immigrant minority-owned companies in comparison with the Canadian-born various.
StatCan’s researchers argued within the report that collaboration between immigrant and Canadian-born homeowners “facilitates the alternate of data, tradition, experiences and networks, serving to to develop merchandise that meet numerous calls for.”
The report additionally famous that companies with each partial or majority immigrant possession tended to pay extra in web taxes, owing partially to receiving much less in tax credit or refunds per worker.
This report by The Canadian Press was first printed Feb. 26, 2025.
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