Financing Profile: Small and Medium-Sized Enterprises in Tourism Industries

Owner characteristics

Tourism small and medium-sized enterprise owners were more likely to be female and twice as likely to be a visible minority compared with non-tourism small and medium-sized enterprise owners

An individual's characteristics and background are important determinants of entrepreneurial activity. In 2007, there were notable differences in demographic characteristics between tourism and non-tourism entrepreneurs.

Previous literature has shown that the tourism sector is a major employer of women (Canadian Tourism Human Research Council, 2009; and Statistics Canada, 2010b). According to 2007 survey results, more than half of businesses in both tourism and non-tourism industries were majority male-owned (51 percent for tourism industries and 65 percent for non-tourism industries); however, compared with businesses in non-tourism industries, those in tourism industries were significantly more likely to be majority female-owned. Specifically, 26 percent of SMEs in tourism industries were majority female-owned, whereas only 16 percent of SMEs in non-tourism industries were majority female-owned. This finding is also consistent with the Financing Profile: Women Entrepreneurs (Industry Canada, 2010), which highlighted that majority female-owned SMEs were more likely to be concentrated in the service sector, particularly in the tourism sector.

In 2007, the mother tongue of an SME owner operating in a tourism industry was less likely to be English and more likely to be French or a language other than English or French compared with a non-tourism SME owner (see Table 2). This coincides with a greater concentration of recent immigrant owners and visible minority owners in the tourism industry than in the non-tourism industry. Specifically, 18 percent of tourism owners were a visible minority and 4 percent were recent immigrants (within the last five years). In contrast, only 9 percent of non-tourism owners were visible minorities and 3 percent were recent immigrants.

Table 2
Owner Characteristics, 2007*

Owner Characteristics	Tourism SMEs (%)	Non-Tourism SMEs (%)
* Bold values denote statistically significant difference at 5 percent. Source: Statistics Canada, Survey on Financing of Small and Medium Enterprises, 2007.
Gender
Majority Male Ownership	51	65
Majority Female Ownership	26	16
Equal Ownership	23	19
Background
Visible Minority (other than Aboriginal)	18	9
Aboriginal	3	2
Disabled	2	2
Recent Immigrant (within last 5 years)	4	3
Held by family members	64	65
Mother Tongue
English	54	68
French	24	18
Other	22	14
Age
Less than 30	2	3
30–39	14	12
40–49	26	28
50–64	45	45
65 and over	13	13
Managerial Experience
Over 10 years	67	72

The majority of owners in both tourism and non-tourism industries were between the ages of 50 and 64 (45 percent for both). Despite being similar in age to SME owners in non-tourism industries, SME owners in tourism industries had less managerial experience than their non-tourism counterpart. As shown in Table 2, 67 percent of tourism owners had more than 10 years of managerial experience, while 72 percent of non-tourism owners had the same amount of experience.