Business Insolvencies in 2023: A Comparative Overview The year 2023 saw a total of 4,810 businesses file for insolvency in Canada, which marked the largest annual volume since we began tracking insolvency data in 2019. This total annual volume is a 41.4% increase since the previous year. It is also a 30.7% increase compared with the second-highest annual volume tracked, which was the total number of business insolvencies in 2019. It appears that businesses continue to struggle with managing higher input costs as well as costs to service or refinance accumulated debts through 2023. As shown in Figure 1, total business insolvencies rose 34.7% over Q3 2023 levels, from a total of 1,129 filings to 1,521 filings. Specifically, recently released data from the Office of the Superintendent of Bankruptcy indicate that business insolvencies rapidly picked up in Q4 2023. Compared with the Q4 data from previous years, total business insolvencies rose 67.7% from 2019 levels, 127.7% from 2020 levels, 107.5% from 2021 levels and 51.6% from 2022 levels.
Figure 1: Total Business Insolvencies in Canada
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Over 2023, a total of 1,108 business proposals and 3,702 business bankruptcies were recorded. This meant that, overall, business proposals made up about 23% of all filings, and business bankruptcies made up the remaining 77%. The proportion of business proposals notably decreased in November and December 2023. From January to September 2023, on average, business proposals made up 24.1% of total insolvencies. However, this proportion decreased to 22.2% in November and reached a low of 16.3% in December. As shown in Figures 2 and 3, a decrease of business proposals corresponds to a hike in business bankruptcies, which could indicate fewer viable refinancing options available to businesses.
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