For months on end, economic pundits have offered a wide range of opinions on whether Canada will slip in a period of recession. This is similar to the conversation in the U.S., as advisors continue to pore over the data to predict if – and when – an economic downturn might begin. Of course, we understand that periods of economic prosperity and economic downturns are quite normal, happening on a regular, cyclical basis. Yet, if there’s one thing our financial markets can’t stand, it’s uncertainty.
In order to confront the real possibility of an economic slowdown, and how that might affect your entrepreneurial plans, FranNet of Canada has some advice to share. In the event a recession becomes a reality, here’s how you can prepare.
The Latest Outlook
In the latest round of this debate, one of the key takeaways seems clear – a recession will happen, and some put the chances of it happening as near-inevitable. In an Oct. 12 edition Proof Point, an online newsletter compiled by the Canadian bank RBC, the lending institution’s economic experts weigh in with a few predictions.
- RBC predicts a moderate recession for Canada in 2023, but it may begin as soon as Q1
- Inflation and higher interest rates are lowering Canadian household purchasing power by $3,000
- An unemployment rate of 7% is predicted, which is not as bad as previous recessions
- Manufacturing may suffer the most, but travel and hospitality may prove resilient
How Long Will it Last?
As many economic experts agree, this recession should not be as extreme as those in our recent past. Inflation remains a primary concern, as the cost of goods and services is still quite elevated. But there seems to be a consensus that Canada’s recovery from the predicted downturn will be swift. Deputy Chief Economist Patrick Perrier, of the Canada Mortgage and Housing Corporation (CMHC), believes the recovery may begin as early as the second half of 2023.
How to Prepare
There are several steps you can take to prepare for a potential recession in Canada, most of which are fairly common sense tips. Reduce spending amidst household budgets, reevaluate any debt servicing payments, and keep an updated resume handy in the event of corporate downsizing. While the latter can be a concern, many employees in similar situations have used the opportunity to explore their entrepreneurial options. And you certainly don’t have to wait until you’re handed a pink slip to begin. If you’ve ever longed to become your own boss, franchising offers an advantageous route to business ownership – and FranNet of Canada can help you discuss your potential options. You can get started right away, with a no-cost, no-obligation consultation with the FranNet consultant who represents your province. You can determine this by using our corporate directory, as our Canadian representatives are listed at the bottom of this page.
2022 has begun to wind down to the finish line, so if you’re ready to begin your entrepreneurial journey before the year is out, FranNet of Canada can help you get started. With consultants serving every Canadian province, you can set up a no-cost, no-obligation appointment with one of our qualified representatives. To find your local province consultant, simply follow this link and select “Canada” on the FranNet Franchise Consultant Directory page of our website. Getting started is easy – you can take our FranNet Ownership Quiz – or simply make an appointment to speak with one of our franchise experts today. And don’t forget to read our bi-monthly blog series, covering franchising issues for all Canadian entrepreneurs!