National Survey Finds Canadian Small Business Confidence Plunges to 58% as Costs Soar and Economic Uncertainty Bites

Zensurance Small Business Confidence Index Reveals Mounting Pressure on Entrepreneurs as Economic Conditions Tighten

TORONTO, Aug. 19, 2025 /CNW/ -  According to the 4th annual Small Business Confidence Index from Zensurance, Canada's leading small business insurance provider, confidence among Canadian small business owners has taken a steep dive this year, with just 58% expressing optimism about the rest of 2025 – a 10-point drop from 2024.

The national survey of more than 1,000 small business owners and independent professionals reveals an increasingly fragile economic outlook, driven by relentless inflation and surging operating costs.

"This year's index sends a clear warning: Canadian small business confidence is eroding," said Danish Yusuf, CEO and Founder of Zensurance. "Entrepreneurs are telling us they're struggling to keep up with rising costs, shifting markets, and policy shocks – all while trying to stay afloat in a tougher-than-ever economy."

Key Findings:

• Only 58% of small business owners feel confident about the year ahead – down from 69.9% last year.
• 62% say the state of the economy is negatively impacting their business, citing rising costs and weaker demand.
• Just 3.7% report soaring revenues, an 81% year-over-year decline, while 51.5% say they're simply 'holding steady,' a 130% year-over-year increase.

Costs and Cutbacks
Nearly half of respondents (43.2%) say rising operational costs are now their no. 1 challenge – well ahead of any other issue, including:

• 34.5% says economic slowdowns or growing economic uncertainty
• 22.4% cite shrinking profit margins

Despite this, many entrepreneurs are pivoting. Nearly 4 in 10 (38.9%) are actively exploring new markets to offset these challenges – underscoring the resilience and adaptability of Canadian small businesses, even in the face of adversity.

Risk Rises as Insurance Coverage Drops

The survey also reveals a 24.2% decline in the number of small businesses carrying insurance – a troubling sign that many owners are making hard trade-offs between cost-cutting and protection.

"We're seeing a growing number of businesses choosing to go without coverage – not because they want to, but because they feel they have no choice," said Yusuf. "That leaves them dangerously exposed at a time when the risk of disruption is higher than ever."

Microbusinesses: The Unsung Economic Engine
The survey shines a light on the heart of Canada's small business sector: microbusinesses.

• 62.8% of respondents operate solo
• Another 37.2% employ teams of just 2 to 4
• Top industries include professional services (33%), retail/e-commerce/hospitality (17.9%), and trades (14.5%)

"This is the real economy," said Yusuf. "These aren't faceless numbers – they're Canadians grinding every day to build something. This data is their voice, and it's time we paid attention."

Survey Methodology
Zensurance surveyed a sample of 1,000 small business owners, entrepreneurs, and self-employed Canadians across industries, including retail, hospitality, professional consulting, construction, and health and wellness. The study was designed to give a pulse check of how confident Canadian small business owners, self-employed professionals, and entrepreneurs are feeling heading into the second half of 2025.

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About Zensurance
Founded in 2016, Zensurance.com is a technology company and leading source for small business insurance. Zensurance empowers small business owners, entrepreneurs, independent contractors, and self-employed professionals across hundreds of industries to shop and get the specialized coverage they need in just a few minutes.

Through their highly regarded client support team and network of over 50 insurance providers, Zensurance provides customers with industry-leading premium savings of up to 35% off and the confidence to thrive in today's market.

For more information, please visit https://www.zensurance.com and follow on X/Twitter, Facebook, Instagram, LinkedIn, and TikTok.

SOURCE Zensurance

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