Franchised small businesses are a major source of employment and economic activity across Canada. According to the Canadian Franchise Industry Economic Outlook 2026, the franchise sector is projected to support approximately 1.83 million jobs across Canada by 2027, returning the industry to roughly the same level of employment seen before the COVID-19 pandemic.
While the industry is recovering, many franchised small businesses continue to face persistent labour shortages. Workforce constraints across multiple sectors, including foodservice, retail, hospitality, automotive services, and personal services, have made it difficult for many operators to recruit and retain employees.
Changes to labour market conditions, including evolving immigration policies and workforce participation trends, have also influenced the availability of workers in many regions. As a result, some franchised small businesses report reducing operating hours, limiting services, or delaying expansion plans due to staffing challenges.
Ensuring that franchised small businesses can access the workers they need will be essential to sustaining the industry’s recovery and supporting economic growth in communities across Canada.
Labour shortage/supply:
Labour shortages facing Canadian small businesses continue to affect franchised businesses across multiple sectors, including foodservice, retail, hospitality, automotive services, and personal services. These industries provide essential services in communities across the country and employ millions of Canadians. Franchised small businesses employ hundreds of thousands of Canadians and depend on access to a stable workforce to operate successfully.
Franchised small businesses also play a critical role in workforce development. Franchises are proud to provide many Canadians with their first job, offering early work experience and opportunities to develop valuable workplace skills. Franchise systems frequently provide structured training programs that help employees build transferable skills and advance in their careers.
To address labour shortages, the Canadian Franchise Association has encouraged governments to pursue policies that strengthen Canada’s labour supply. This includes supporting workforce training, encouraging greater labour force participation, and reducing barriers to employment.
For some small businesses, programs such as the Temporary Foreign Worker Program (TFWP) provide an important option when employers cannot find workers locally despite extensive efforts to recruit Canadian workers. The program is not the first choice for franchised small businesses. Operators consistently prioritize hiring Canadian workers whenever possible. When labour shortages persist despite these efforts, the TFWP can serve as an important backstop that helps small businesses maintain operations and continue serving their communities.
Gig economy:
Governments across Canada are examining how to regulate the gig economy, particularly work performed through app-based digital platforms such as food delivery and ride-hailing services.
Many franchised small businesses rely on these platforms to reach customers and compete in an increasingly digital marketplace. In the gig economy model, platform operators connect independent workers, customers, and businesses through a digital marketplace, facilitating transactions between the parties.
Franchised small businesses that use food delivery or other app-based services are customers of the platform, purchasing a service that connects them with consumers. They do not recruit, schedule, or supervise the app-based workers who perform deliveries or other tasks.
Policy frameworks regulating digital platform workers must reflect this relationship.
The CFA supports fair treatment and appropriate protections for gig economy workers. However, responsibility for providing worker protections should rest with the platform operators that engage these workers, not with small businesses that use the platform as a service.
Without this distinction, franchised small businesses could face unintended legal liability for workers they do not employ or control. Clear policy definitions ensure that app-based worker regulations protect workers while allowing small businesses to continue using digital platforms to serve customers.
The CFA encourages governments to consult with small business stakeholders when developing gig economy legislation to ensure balanced solutions that support workers, consumers, and local businesses.
Skilled trades:
Skilled trades are essential to Canada’s economy and to many franchised small businesses operating in sectors such as automotive services, home services, construction-related services, and technical repair industries. These businesses rely on a strong pipeline of skilled workers to maintain operations, serve customers, and support local economies.
Governments across Canada have taken important steps to encourage more Canadians to pursue careers in the skilled trades by expanding training opportunities, modernizing apprenticeship programs, and investing in training infrastructure. These initiatives help address labour shortages while creating rewarding career paths for workers.
The Canadian Franchise Association supports continued investment in skilled trades education, training programs, and apprenticeship pathways. Strengthening the skilled trades workforce will help ensure that franchised small businesses have access to the talent they need to grow and continue providing essential services in communities across the country.
Our Ask
To address labour shortages facing Canadian small businesses, the Canadian Franchise Association urges governments to work with the franchise community to strengthen access to labour by:
- Encouraging greater workforce participation in Canada, particularly among youth, newcomers, and experienced workers.
- Supporting workforce training and employer-led skills development, helping small businesses invest in employee training and productivity.
- Maintaining responsible access to international labour, including the Temporary Foreign Worker Program, when employers cannot recruit workers locally.
Expanding skilled trades training and apprenticeship pathways to help address labour shortages in technical and specialized sectors.