Canadian business owners say trade uncertainty hitting as hard as the pandemic: EQ Bank survey

A new survey from EQ Bank paints a stark picture for Canada’s solopreneurs as they navigate rising trade uncertainty, inflation and financial stress.

The poll found that half (51%) of solopreneurs (independent business owners who operate alone) say the current global trade environment is having as much or more impact on their business as the aftermath of the pandemic, while nearly one-quarter (24%) are worried about their financial future. One in three (32%) admit they’ve contemplated closing their business at least occasionally.

“Today’s environment is putting immense pressure on many solopreneurs and small business owners who are adapting to new realities in trade, costs, and competition every day,” said Dan Broten, senior vice-president and head of EQ Bank, in a statement. “Their contribution to Canada’s economic fabric is enormous, and it’s important we continue to find innovative ways to better support them.”

Solopreneurs face pandemic-level strain

The findings reveal that economic turbulence has rekindled many of the same pressures entrepreneurs faced during COVID-19.

About 30% said shifting U.S. trade policies pose an “existential threat” to their business. Many cited practical challenges, including sourcing materials (38%), pricing goods and services, (34%) and planning for growth (30%).

While small businesses are frequently referred to as the backbone of the Canadian economy, 60% of solopreneurs say they don’t feel recognized as business owners on par with larger firms. Another 51% said they don’t feel valued as a key part of Canada’s economic structure.

And according to the survey, common misconceptions persist: More than six in 10 respondents said others wrongly assume they make a lot of money (61%) or can take time off whenever they want (63%) while nearly half (45%) feel their work is viewed as less serious than that of employers with staff.

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Tight finances and limited support

The report from EQ Bank shows that many solopreneurs are working long hours for modest returns.

Over one in four (27%) estimate they earn less than $17.20 per hour — only slightly above Canada’s average minimum wage — and nearly one in five (18%) earn below $9.00 per hour. Female entrepreneurs report earning $8.00 less per hour, on average, than men.

About 33% say they lack an emergency fund, while another 38% mix business and personal savings, showing that financial cushions for solo business owners are thin, especially when you consider that more than half (59%) have taken on debt to launch their ventures, according to the survey.

Banking remains a pain point, with 54% citing high or unexpected fees, low interest rates or poor value from existing business accounts.

Nearly four in 10 (39%) expressed dissatisfaction with the financial support available to them.

“There’s a clear gap between the traditional banking tools available and the level of support solopreneurs need to thrive,” said Cathy Ly, VP of Small Business Banking at EQ Bank, in the release.

Resilience defines Canada’s solo entrepreneurs

Despite the challenges, nearly seven in 10 (69%) solopreneurs said they would choose the same path again, with top motivations including being their own boss (64%) and bringing their passion to life (43%).

“Even in the face of these headwinds, determination and pride continue to define Canada’s small business community,” Ly added. “Their resilience is what inspired EQ Bank to enter the business banking space and design products that help them earn more and save time.”

EQ Bank recently launched its Business Banking platform, which includes a high-interest, zero-fee business account, flexible GICs and an upcoming prepaid business card.