Canada is one of the top countries globally for women’s entrepreneurship and women entrepreneurs are important for Canada’s economic growth, job creation, and enhanced community development. However, there are still far fewer women entrepreneurs in Canada than there are men entrepreneurs.

This article explores the statistics surrounding women entrepreneurs in Canada, including historical changes, sectors women entrepreneurs are most likely to work in, and challenges facing women entrepreneurs in Canada.

Women Entrepreneur Statistics for Canadians

  • Approximately 18% of all companies are majority-owned by women in Canada.
  • The Women Entrepreneurship Strategy launched in 2018 represents almost $7 billion in investments and commitments to support women entrepreneurs in Canada.
  • The number of self-employed women increased in 2022 after falling during the COVID-19 pandemic.
  • Globally, Canada has the third highest index for women’s entrepreneurship.
  • Over a quarter of SMEs in the retail trade sector are women-owned.
  • The proportion of self-employed women grew in many sectors between 2021 and 2022.
  • Ontario has the highest proportion of women-owned SMEs.
  • Women-owned companies have a slightly higher failure rate than men-owned companies.
  • Rising inflation and costs are seen as the biggest obstacles to success by women entrepreneurs.
  • Women SME owners are more likely to have a university degree but less likely to have significant managerial experience than men.
  • Almost half of self-employed women chose self-employment to be their own boss.

Women Entrepreneurs Are Underrepresented in Canada

Canada’s women entrepreneurs play an important role in job creation, driving growth and innovation, and advancing social sustainability and development. However, the Women Entrepreneurship Knowledge Hub estimates that only around 18% of Canadian businesses of all sizes in the private sector are majority-owned by women (meaning women own more than 50% of the company). 

Women entrepreneurs often have higher barriers to success than men. However, the Canadian government is committed to supporting women’s entrepreneurship and encouraging more women to become entrepreneurs. One of the ways the government is supporting women entrepreneurs is through the Women Entrepreneurship Strategy, which was launched in 2018. It aims to increase women entrepreneurs’ access to financing, expertise, talent, and networks so they can start up or scale up their businesses and access new markets.

Women Entrepreneurship Strategy

The Women Entrepreneurship Strategy (WES) represents almost $7 billion in commitments and investments across different federal departments, crown corporations, and agencies. From 2022 to 2023, 15,073 loans were given to women entrepreneurs by organisations, delivery partners, and partner programmes.

During the same time, business support programmes that focus on women entrepreneurs were accessed over 71,800 times, while programming and events focused on building stronger ecosystems were accessed 29,590 times by women entrepreneurs.

The Number of Women Entrepreneurs Has Increased

In Canada, small and medium-sized enterprises (SMEs) employ approximately 88.2% of the labour force in the private sector and 75.2% of the labour force in the public sector. There were 1.21 million employer businesses in 2021 with 1.19 million small businesses, accounting for 97.9% of all businesses, and 22,700 medium-sized businesses accounting for 1.9% of all businesses.

Canada’s SMEs account for 99.8% of women-owned companies. In 2018, 19.8% of Canada’s SMEs were owned by women. In 2020, the number of women owners had increased to 20.3%. However, according to Statistics Canada, women owned 28.5% of SMEs in 2021. While there are differences in the percentages between the data sources, the number of women owners remains low compared to men SME owners.

During the COVID-19 pandemic, the number of self-employed women fell in Canada. However, the numbers recovered in 2022 when there were 988,400 self-employed women compared to 975,200 in 2021.

At the same time, the gap between men and women establishing businesses has also narrowed. The rate of companies established by women grew from 68% to 77% of the men-established companies rate in 2022.

Canada Has the Third Highest Women Entrepreneur Index in the World

According to the Mastercard Index of Women Entrepreneurs, Canada is one of the leaders in the world in terms of women’s entrepreneurship. In 2021, Canada had the third highest index with only New Zealand (second) and the United States (first) having higher scores.

This statistic shows that Canada is a frontrunner when it comes to supporting women entrepreneurs even if there is still a long way to go before the number of women and men entrepreneurs in Canada is equal.

Retail Trade Has the Highest Proportion Of Women-Owned Companies

Canadian women entrepreneurs are found in all sectors but some sectors have a notably higher percentage of women than others. The sector with the highest proportion of women-owned companies is retail trade where 26.2% of SMEs are majority-owned by women.

The next sectors with higher than average proportions of women-owned companies were the professional, scientific, and technical services sectors with 20.9%, the accommodation and tourism sector with 18.1%, and the food services sector with 17.6%. In general, there tend to be more women entrepreneurs in the service sectors. This trend has remained relatively unchanged in Canada.

The Number of Self-Employed Women Is Growing in Several Sectors

The number of self-employed women is growing in many sectors. Between 2021 and 2022, the proportion of self-employed women grew from 15% to 17.1% in the professional, scientific, and technical services sector. In retail trade, the growth was more modest, growing from 8.6% in 2021 to 8.8% in 2022. In accommodation and food services, the rate increased from 7.1% to 7.9%, and in manufacturing from 2.7% to 2.9% in the same year.

However, not all sectors saw growth in the number of self-employed women. The number of self-employed women fell from 6.1% to 4.8% between 2021 and 2022 in the agriculture, forestry, and hunting sectors combined with the mining, quarrying, and oil and gas sectors. The transportation and warehousing sector also saw the proportion of self-employed women fall from 2.1% in 2021 to 1.5% in 2022.

Indigenous and Diverse Women Entrepreneurs in Canada

The overall proportion of self-employed indigenous and diverse women decreased between 2017 and 2020. However, the proportion of self-employed women living with a disability grew during the same period. Despite the increase, less than 1% of SMEs in Canada are owned by people living with disability.

Many women from indigenous and diverse backgrounds have heightened barriers to entrepreneurship related to systemic racism, geographic isolation, and lack of networking contacts.

Ontario Has the Largest Percentage of Women Owners

In Canada, SMEs are concentrated in two provinces: Ontario and Quebec. 36.9% of SMEs are in Ontario and 21% in Quebec. British Columbia and Alberta are next with 15.7% and 13.1%, respectively, while 6.3% of SMEs are in the four Atlantic provinces. Manitoba and Saskatchewan each have 3.3% of the SMEs in Canada and only 0.3% of Canadian SMEs are based in the territories.

Similarly, there are significant differences between Canadian provinces and territories in the number of women majority owners with Ontario and Quebec once again leading the pack. In Ontario, 38.2% of SMEs are majority owned by women. It is followed by Quebec with 20.3% and British Columbia with 17.3%.

Women-Owned SMEs Have Lower Survival Rates

In Canada, SMEs that are majority owned by women tend to have lower survival rates than SMEs majority owned by men. While women and men-owned SMEs are equally likely to remain in operation during the first two years since the company’s founding, the difference in the survival rate becomes increasingly apparent the longer time interval gets. For example, 14 years after the founding of the company, approximately 45% of women-owned SMEs were still in operation compared to 50.2% of men-owned companies.

Interestingly, the SMEs with the best survival rate are those where the ownership is equally split between the two genders. For these companies, the 14-year survival rate is 57.3%. This seems to indicate that there are considerable benefits in combining the different strengths that women and men owners can bring into a company.

Rising Inflation Was Seen As The Biggest Challenge in 2022

Women entrepreneurs saw rising inflation as the biggest challenge to their success in 2022. 57.4% of women-owned businesses said rising inflation was their biggest challenge. However, women owners were slightly less likely to worry about inflation since the overall proportion of companies that saw inflation as a challenge was 60.8%. Women-owned companies were also slightly less likely to worry about the rising cost of inputs than all companies at 46.7% compared to 48.5% overall.

On the other hand, women-owned companies were more likely to worry about recruiting skilled employees at 39.7% compared to 38.6% of all companies. They are also more likely to see retaining skilled employees as a challenge with 35.8% of women-owned companies citing this as a concern compared to 30.7% of all companies.

Women Entrepreneurs Are More Likely to Have a University Degree

In Canada, women entrepreneurs are more likely than men entrepreneurs to have a university degree. 34.7% of women entrepreneurs have a college degree, 27.4% have a bachelor’s degree, and 19.8% have a master’s degree or above. For men entrepreneurs the proportions are 28.7%, 25.1%, and 14.5%, respectively.

However, women SME owners are less likely to have considerable prior managerial experience. 66.8% of women who own SMEs have over ten years of managerial experience compared to 76.1% of men. More women entrepreneurs (7.7%) had less than five years of management experience compared to men (5.2%).

Main Reasons for Choosing Self-Employment

The main reason both women and men choose self-employment in Canada is being their boss. In 2022, 50.6% of women entrepreneurs said they became self-employed so they could be their own boss. For men, the proportion that cited this reason was 47.6%. Men were more likely than women to give work-family balance as a reason for self-employment at 45.1% compared to 42.6%.

Other key reasons for self-employment among women were pursuing new opportunities at 37.2%, the best way to deliver services to clients at 33%, not enjoying their previous job at 23%, and difficulties in finding another job at 18.7%. In addition, 7.7% of women entrepreneurs said owning their own business was a family tradition.

Conclusion

While the number of women entrepreneurs has increased, they are still underrepresented in Canada. The Women Entrepreneurship Strategy launched in 2018 and aims to change this by facilitating a more conducive environment for women-led businesses and there is already evidence of this strategy working and facilitating more women to become entrepreneurs.

While many things have improved for women entrepreneurs in Canada, women-owned SMEs are still more likely to fail than men-owned enterprises. This, together with the significantly lower number of women entrepreneurs, shows that much more needs still to be done to support women not just in becoming entrepreneurs but being able to remain in business.

Frequently Asked Questions

Canada is very supportive of women entrepreneurs and actively seeks to remove barriers women entrepreneurs might face. One of the ways the Canadian government supports women entrepreneurs is through a strategy launched in 2018 that helps women find financing and build networks.

While the number of women-owned companies is still significantly lower than the number of men-owned companies in Canada, their number is increasing. In 2022, there were 988,400 women entrepreneurs out of approximately 3.5 million entrepreneurs.

The one province where the proportion of women entrepreneurs is significantly higher than the national average is Ontario. In Ontario, almost 40% of small and medium-sized companies are owned by women.