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May 28, 2021BUSINESS OPENING AND CLOSING, FEBRUARY 2021 Statistics Canada released updated data on monthly business openings and closures for February 2021. A business will be classified as open if it had no employment in the previous month and then has employment in the next month and a business will be closed if it had employment the previous month and no employment in the current month. For opening and closing, the reason could be a permanent change (i.e. business exit) or temporary for reasons such as seasonal operations, capital maintenance, restructuring or the COVID-19 situation. Continuing business are those that had employment in both the current and previous month. Active businesses are the sum of continuing and opening business in the current month.
Public health measures are tightened or eased across provinces depending on their respective COVID outbreaks. At the outset of the pandemic in March 2020, the number of active businesses declined sharply until May. The decline in active businesses in Nova Scotia was sharper than the national average, but less than in Ontario. Since May 2020, there has been a recovery in the number of active businesses across all provinces. As new restrictions are imposed across some provinces, this recovery has been slowed or even partially reversed.
The number of active businesses in Nova Scotia declined 0.1% from January to February 2021. Nationally, active businesses increased 0.1%. The number of active businesses were down in Nova Scotia, New Brunswick and Newfoundland and Labrador. Ontario (+2.8%) and Alberta (+1.6%) posted the largest increases.
Compared with February 2020, the number of active businesses was down 0.9% for Nova Scotia in February 2021. Nationally, active businesses are lower by 2.0% from February 2020 to February 2021. The number of active businesses was down in all provinces compared to February 2020, with the exception of British Columbia (+0.5%). The largest declines were experienced in Newfoundland and Labrador, Ontario and Alberta.
The number of active businesses in Halifax was up 1.0% from February 2020 to February 2021. This suggests that the decline in active businesses across Nova Scotia was concentrated outside the city. Among cities (Census Metropolitan Areas), the declines in active businesses from February 2020 to February 2021 were most severe in Toronto and St. Catharines - Niagara. The two cities with the largest rises in the number of active businesses were Abbotsford-Mission and Kelowna.
The calculation for the opening, continuing and closure rate have been made based on the number of active business in the previous month. The rate at which business either opened, continued or closed can be examined to see how number of active business has changed.
Most businesses continue operating each month. At the height of COVID-19 related restrictions, the share of businesses that continued to operate from one month to the next fell to 89.4% in Nova Scotia, down from 94.2% in February 2020. National continuing rates fell from 95.6% in February to 88.7% in April 2020.
Business continuing rates rose sharply in the summer, reaching 97.4% in Nova Scotia in July and 95.9% nationally in August. Since then, there has been some decline in Nova Scotia's business continuing rates. February business continuing rates slipped to 93.54% in Nova Scotia, the lowest among provinces. National business continuing rates declined to 95.3%.
Nova Scotia’s business opening rate declined from 4.2% in February 2020 to 3.1% in April. By June, the Nova Scotia business opening rate increased to 7.8% as the economy re-opened and restrictions were lifted. From July to February, Nova Scotia's business opening rate declined back to be closer to pre-pandemic levels, falling to 4.5% in February 2021. Nationally, the opening rate did not decline substantially in March and April, and increased in June and July. Since July, the national business opening rate has declined, falling to 5.2% as of January 2021. National business opening rate increased to 5.4% in February.
The rate of business closures in Nova Scotia was 3.6% in February 2020. This increased to 13.6% in April and has subsequently fallen to 3.6% in December 2020. However, the rate of business closures in Nova Scotia increased in the first two months of 2021 and was at 4.0% in February, still below the average 2019 rate. Nationally, the business closing rate increased from 4.3% in February to 12.6% in April. As of February 2021, the national business closing rate was 4.7%.
The COVID-19 situation has impacted business sector industries to different degrees. Nova Scotia active business were lower in many sectors when compared to February 2020. Nova Scotia's largest declines were observed in mining/oil/gas (-13.3%), forestry and fishing (-5.6%) and information and culture (-3.5%). Most sectors had fewer active businesses in February 2021 than February 2020 with increases in utilities, manufacturing, transportation, professional/technical services; and finance/insurance.
Nationally, the number of active businesses was down for most industries, with a notably steeper decline in accommodation/food services as well as arts/entertainment/recreation, and personal/repair services.
Statistics Canada has broken out specific data for tourism-related industries. This shows that the number of active tourism-related businesses was down 1.9% in Nova Scotia from February 2020 to February 2021. Nationally the decline was 7.5%. Compared to the national average, Nova Scotia has had larger declines among active businesses in accommodations. Nova Scotia's declines in active tourism businesses have been smaller than the national average for all other tourism related industries.
All industries in Nova Scotia that reported declines in active businesses during first-wave of the pandemic have seen partial or complete recovery since May.
The source data is seasonally adjusted. The data may not aggregate due to firms being classified into multiple industry or geography.
Source: Statistics Canada. Table 33-10-0270-01 Experimental estimates for business openings and closures for Canada, provinces and territories, census metropolitan areas; Methodology: Business Opening and Closing
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