Xinhua, Ottawa :
A new study finds that Canada’s number of billion- dollar firms by annual revenue are more globally engaged than ever but the country’s economy is far more dependent on smaller firms than other similar economies.
The study, released by an organization known as Centre for Digital Entrepreneurship and Economic Performance (DEEP Centre) in Canada Wednesday and commissioned through a partnership with three other entities, evaluated 169 publicly traded firms with revenues of more than one billion Canadian dollars (about 0.94 billion U.S. dollars). Together they employ nearly 1.4 million Canadians.
The research presented a demographic analysis of Canada’s largest firms, their contributions to Canadian employment and research and development spending, as well as an analysis of the country’s performance in producing globally competitive firms relative to a series of comparator economies, including Australia, Germany, Sweden, the United Kingdom and the United States.
Compared to similar economies, Canada has an equivalent number of billion-dollar firms, but they are highly concentrated in natural resources and financial services sectors, according to the study.
Canada has excelled in developing large resource firms over the past decade, notably in the energy sector, a development that should not surprise given the confluence of growing global demand and the country’s abundant natural resource endowments. The relative weight of Canada’s energy sector, however, is juxtaposed against a relatively small share of manufacturing firms as compared to Germany, Sweden, Britain and the United States.
In the period 2003-2012, for instance, employment in Canada’s largest firms grew the most strongly in resource, service and engineering and construction sectors. The manufacturing sector, however, saw its number of mega-large firms and related employment shrink significantly.
Positive findings also included the fact that leading Canadian firms are more globally engaged than ever, and this global engagement is a significant factor underpinning their growth-both over the past decade and into the future.
High-growth firms in Canada increasingly view themselves as global enterprises, with significant overseas operations. In fact, internationalization was highlighted by most executives as a critical success factor going forward given the relatively small size of Canada’s domestic market.
The DEEP Centre study also examined a sample of Canada’s fastest growing small firms. A majority of the firms cited Canada’ s comparative lack of seasoned management talent as the number one inhibitor of growth.
