BDC, Canada’s bank for entrepreneurs, is releasing the results of a comprehensive research project that highlights four critical trends shaping Canada’s future business landscape. 4 key trends shaping the future of Canada’s businesses is designed to help entrepreneurs plan their next business move in a time of constant change.
Over the past five years, SMEs have had to adapt to a number of crises: the COVID-19 pandemic, the 2021-2023 global supply chain crisis, rising inflation, labour shortages and rapid technological change, including a rapid rise in e-commerce and conversational AI. The study offers insights and tools to help entrepreneurs anticipate what’s ahead and make informed decisions to ensure long-term success.
Trend #1: Increasing costs will remain a concern
The study finds that 75% of businesses say rising costs have affected their business. The industrial product price index (IPPI), which tracks the price of products at factory gates, increased by 35% between Spring 2020 and Spring 2022. While some input prices have and will come down, the price of energy will remain high as extreme weather events affect electricity output, new investments to increase the electricity supply are slow to happen and geopolitical situations maintain gas prices above the pre-pandemic average.
Optimising energy consumption and adopting cost-saving technologies can mitigate these pressures.
Trend #2 – Zoomers as consumers
About two-thirds (66%) of Canadians are willing to pay extra for locally produced products, and 50% are willing to pay extra for environmentally friendly products or services. Zoomers, who were born between 1997 and 2012, are significantly more likely to pay more for environmentally friendly clothes, shoes and accessories (71%) compared to other generational cohorts (54%). Considering that all Zoomers will be adults by 2030, the market for environmentally friendly products and services will continue to expand.
Trend #3 – Labour shortages will persist over the next decade
This will remain a pressing issue, particularly with respect to skilled workers: nearly 70% of future job openings will require post-secondary education or management skills, which are areas currently reporting the lowest unemployment rates, making it even harder to find qualified candidates. It seems that 88% of businesses think it will be just as hard or harder to find employees in the next five years.
The study presents the top three strategies for dealing with labour shortages:
- Technology and automation can reduce the time employees spend on repetitive or low-value tasks.
- A people strategy with competitive compensation, growth opportunities and a positive culture can help attract and retain talent.
- Expanding the hiring pool by upskilling candidates through training, forming partnerships with universities and schools and hiring diverse workers can help ease labour and skills shortages.
Trend #4 – The rapid pace of technological change
With 82% of businesses already considering technology critical, and 38% anticipating significant disruption from new technologies, it is imperative for entrepreneurs to embrace Digital Transformation. Technology can automate repetitive tasks, allowing employees to focus on higher-value activities.