Canada’s entrepreneurial decline threatens innovation and growth

Calgary Chamber calls for bold federal action as fewer entrepreneurs, lagging tech adoption and low competition hold Canada back

Calgary, AB, April 10, 2025 – Despite a growing population, Canada has 100,000 fewer entrepreneurs today than it did two decades ago — a decline that threatens innovation, competitiveness and long-term prosperity.

"The strength of entrepreneurship in Canada means more ideas, more jobs, and more opportunities for growth,” says Ruhee Ismail-Teja, Vice President, Policy & External Affairs at the Calgary Chamber of Commerce. “The trend of having fewer and fewer entrepreneurs is alarming – especially at a time when diversification, innovation and productivity are core to our economic future."

Small businesses — long the backbone of Canada’s economy — are facing mounting pressure. Rising costs, barriers to accessing capital and growing regulatory burdens limit their ability to invest in the very drivers of productivity: research and development, automation, digital technology and cybersecurity. At the same time, fewer new businesses are entering the market and significant barriers to entry mean a few players dominate sectors like telecommunications, groceries, and transportation, contributing to a long-term decline in competition.

“We’re seeing a significant decline in competition in Canada, and as competition falls, so does the incentive to innovate, leading to fewer choices, higher costs and stagnant wages for Canadians,” says Ismail-Teja. “The reversal of this trend would be significant: more innovation, higher competitiveness, faster growth, and ultimately, a boost to national productivity. The ability to start and scale an idea should be a competitive advantage for Canada; we must be a place where opportunities abound, and entrepreneurs can turn their dreams into a reality.”

Canadians are aligned on the need for action. Recent polling commissioned by the Calgary Chamber finds:

• 74% of Canadians want more government investment in technology and innovation — including 51% who specifically want to see more support for the digital economy.
• Only 38% believe the federal government is doing a good job supporting innovation and technological advancement.

"Canada is strong at research and development, but weak at scaling ideas into global solutions – which is a missed opportunity given Canada has what the world needs," adds Ismail-Teja. “We must have a national strategy that bridges that gap — one that makes it easier for businesses to innovate, commercialize and compete on the world stage.”

Entrepreneurship by the numbers

• Canada has 100,000 fewer entrepreneurs than 20 years ago, despite population growth.
• Small businesses make up 98% of all employer businesses in Canada and contribute over 50% of GDP generated by the private sector.
• Canada ranks 14th among 133 countries featured in the Global Innovation Index.
• Only 38% of Canadians believe the federal government is doing a good job supporting innovation and tech advancement.
• 74% of Canadians want the government to invest in technology and innovation, including 51% who would prioritize investment in the digital economy.
• Business entry rates are declining, while exits have outpaced entries in several recent years.

To build a more competitive, innovative and resilient economy, the Calgary Chamber of Commerce is calling for five bold actions:

1. Make it easier to access capital. Unlock low-barrier funding so businesses of all types can invest, grow and compete.
2. Help small businesses scale. Raise the small business tax threshold to give growing companies the runway they need to succeed.
3. Boost innovation and tech adoption. Support digital tools, IP protection and commercialization to turn Canadian ideas into global solutions.
4. Cut red tape. Modernize grants, streamline procurement and launch a business concierge to help navigate federal programs.
5. Create space for new players. Re-examine competition rules to drive innovation, lower costs, and increase choice for Canadians.

About Inflection Point

Inflection Point is a plan for a competitive, productive and prosperous Canada. It outlines 82 evidence-based policy recommendations across five pillars, shaped by extensive consultation with businesses and Canadians through roundtables, surveys and national polling. These recommendations are intended for all political parties, elected officials and civil servants — recognizing that both government and the business community have a shared responsibility to address Canada’s most pressing challenges.

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About the Calgary Chamber of Commerce

The Calgary Chamber of Commerce exists to help businesses reach their potential. As the convenor and catalyst for a vibrant, inclusive and prosperous business community, the Chamber works to build strength and resilience among its members and position Calgary as a magnet for talent, diversification and opportunity. As an independent, non-profit, non-partisan organization founded in 1891, we build on our history to serve and advocate for businesses of all sizes, in all sectors across the city.

Media opportunities

For media inquiries, please contact

Brittany Brander, Manager, Public Relations & Communications
media@calgarychamber.com