If the Great Recession put U.S. entrepreneurship into a deep freeze, the COVID-19 pandemic lit a fire under American self-starters, and the boom in business creation that began in 2020 has kicked into overdrive.
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December marked the fastest 12-month stretch of startup activity on record, based on the number of what the U.S. Census Bureau calls “high-propensity business applications.” It’s the latest sign that America’s economic engine continues to defy expectations of a slowdown.
High-propensity applications are filings for new businesses that census officials deem to have a strong likelihood of turning into actual businesses that hire employees. Total business applications were up across almost all industries from a year earlier, except for transportation, real estate and the arts, with the retail sector attracting the largest number of entrepreneurs.
That’s not surprising given the resilience of U.S. consumers. U.S. retail sales climbed at the fastest pace in three months in December, topping expectations and causing investors to rethink their bets that the U.S. Federal Reserve will cut interest rates in March.
The situation couldn’t be more different in Canada. There are no comparable numbers on business applications here, however Statistics Canada releases a monthly count of business openings and closures, as well as a running tally of active businesses. The latest numbers, for September, show the number of active businesses plunged to the lowest level since August, 2022 – yet another sign entrepreneurship in Canada is struggling.
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Jason Kirby