58% of Canadian small businesses are rehiring: survey

58% of Canadian Small Businesses Are Rehiring (PHOTO: Wagepoint)

TORONTO — A new survey conducted by Wagepoint, creators of online small business payroll software, found that 58% of small businesses that laid off staff due to COVID-19 are now planning to rehire in the next three months.

The survey found layoffs in March represented 60% of layoffs this year, but by the end of June, 55% of those employees had been rehired, an upward trend that continued into July.

“Small businesses employ more Canadians than any other part of our economy. So, when they got hit hard by COVID-19, we all got hit hard,” said Shrad Rao, CEO of Wagepoint, in a prepared statement. “But small businesses are built on entrepreneurial optimism. They’ve always fought against the odds, and now we’re seeing them do it again.”

When COVID-19 first struck, 60% of Canadian small businesses were forced to make rapid changes to their workforce. Here’s a breakdown how those small businesses responded:

• 40% reduced headcount (either temporarily or permanently)
• 44% reduced hours or compensation
• Firms with 10 or more employees were the hardest hit (70% reduced either headcount, hours, or compensation)
• Firms with fewer than 10 employees were still impacted, but less so (57% reduced either headcount, hours, or compensation)

Findings from the small business survey suggest a growing awareness of the need for speed and flexibility in payroll. Seven in ten (72%) of small business owners believe payroll is important (on par with sales, invoicing, and general accounting), and two in five of those (40%) that reduced headcount agreed that payroll needs to be flexible enough to accommodate quick changes to their workforce. Furthermore, over a quarter (26%) of small business owners said paying employees quickly and accurately has taken on a whole new meaning during COVID-19.