Subsidy falls short for 37% of small biz

As applications opened Monday for the Canada Emergency Wage Subsidy (CEWS), a new report suggested small businesses are divided on how helpful it will actually be.

According to the Canadian Federation of Independent Business, which conducted the survey over the weekend, receiving 8,892 responses,

37% of small businesses said the subsidy will not help them, 29% said it will help them avoid further layoffs or recall staff, while 21% were unsure.

“The federal government took a big step by increasing the wage subsidy to 75% and opening it up to businesses of all sizes and structures. It will help many, but there are still a lot of businesses in dire need of help that report they will not be able to access it,” said CFIB president Dan Kelly.

CEWS will subsidize an approved employer’s payroll at a rate of 75% of wages normally earned by employees, up to a maximum benefit of $847 per week.

The program is running for 12 weeks, from March 15 to June 6. The subsidy applies to existing and new employees. The CFIB recommended the government eliminate the 30% test for small- and medium-sized firms or the need for a test for firms ordered by governments to fully or partially close.

It also recommended creating a different test to ensure new or rapidly growing firms can access the support, flexibility for firms with special circumstances and reduce the 30% test to 15% for March to reflect that the major effects on businesses began midmonth.