Fewer individuals in Prince Edward Island are initiating or taking over businesses, as indicated by the Canadian Federation of Independent Business. Frédéric Gionet, the CFIB’s director of legislative affairs for Atlantic Canada, mentioned to CBC’s Island Morning that there have been more closures than new business establishments recently.
Gionet highlighted that from 2019 to 2023, there was a consistent increase in new businesses each year. However, since January 2024, a downward trend has been observed, with approximately 1,300 new businesses established compared to 1,700 closures during the same period.
The reasons for the closures, according to Gionet, are varied, with decreasing consumer demand being a significant factor. He emphasized that there is a noticeable trend of people economizing and being more cautious with their spending, making entrepreneurship less appealing amidst economic uncertainties and supply chain challenges.
Patrick Guindon, who owns and operates Creative Rebel Studio in Montague, shared his firsthand experience of the challenges faced by small businesses on the island. Despite offering art sessions, classes, and events for three years, Guindon expressed that business has been slower than anticipated, leading to quiet weekends at the studio.
To sustain the studio, Guindon has conducted events and workshops off-site to supplement revenue. However, he acknowledged that these efforts might not be sufficient to maintain the storefront operational, considering the financial strain. Guindon, a former teacher, even mentioned the possibility of returning to substitute teaching to support his family.
Guindon pointed out that people are carefully managing their expenses, with art being a discretionary spending category that may be sacrificed when money is tight. He stressed the financial realities many families face, empathizing with the difficulty of meeting essential needs, such as groceries, in challenging times.
Similar to Prince Edward Island, other provinces in Canada are also witnessing an increase in small business closures. The CFIB noted that by the third quarter of 2025, closure rates across the country were escalating at concerning levels not seen in over a decade outside the context of the COVID-19 pandemic.
Gionet urged provincial and federal governments to address barriers hindering entrepreneurship, such as high tax burdens and bureaucratic hurdles that impede business operations. He emphasized the importance of supporting entrepreneurs as they are the potential future employers, underscoring the urgency of addressing these challenges promptly.