Millennials and Gen Z are leading change in ‘shadow hustle’ economy, survey finds
By Natasha O’Neill, CTVNews.ca Editor
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Toronto, Ontario (CTV Network) — Younger generations are driving the “micro-entrepreneur economy,” according to a recent RBC poll.
Released last month, the Small Business Survey finds that 74% of Canadian small business owners and aspiring entrepreneurs are motivated to start a side business or other business because of the rising cost of living. RBC says that number rose to 84% among Gen Z respondents.
Ipsos Canada conducted the survey from August 12-15 with a total of 1,501 respondents.
The idea of home ownership is a pipe dream for many younger generations in Canada. Young Canadians face a huge wealth gap compared to older generations. In August 2022, the average monthly rent for all property types in Canada was $1,959. The most expensive cities are Vancouver and Toronto, with average monthly rents of $2,574 and $2,329 respectively.
The majority (77%) of current and potential entrepreneurs say their goal is to create a source of income to support themselves, including 86% of millennials.
Maha Fatima, a third-year student at the University of Waterloo, started her small business during the COVID-19 pandemic after being laid off.
“I was struggling financially,” Fatima told CTVNews.ca. “It was very difficult to find work. I always wanted to start something and so I went to YouTube. And I used to search for all these entrepreneurial videos about teenagers my age or older starting these little businesses with lip gloss and little jewelry or phone cases.
It was then that Mahajabeen was created.
The Arabic name, which means essence of the moon, encapsulates the heart and soul that Fatima poured into the sideways bustle. Drawing inspiration from poetry, TV shows and her own emotions, Fatima creates jewelry inspired by Greek mythology, from necklaces to rings.
“I kind of have a focus group with my Instagram audience where I bounce ideas off, whether it’s materials, colors and marketing ideas, and what sizes we should come up with,” a- she declared.
Without the extra income from her small business, Fatima couldn’t imagine a life without it. She and a roommate are currently paying $2,200 a month for a two-bedroom apartment in Waterloo, Ont.
“If I hadn’t started this business, I don’t think I could afford to eat and go to school.”
To pay for their education, young Canadians are going into debt. 2019 figures released by the Government of Canada show nearly two million students owed money to the federal government with an average loan balance of over $13,000 upon graduation.
The RBC survey indicates that there is a trend towards owning and running a business fueled by the accessibility of new technologies and digital solutions. Social media, in particular, allows anyone to be seen and advertise a business.
Forty-seven percent of respondents say emerging technologies allow them to reach new markets and explore new opportunities. Just under half (47%) believe that managing their side activities remotely reduces the overhead costs of starting a business.
RBC also says there is a shift in customer preferences, allowing more local Canadian businesses to start. According to RBC, Canadians “crave” authentic, local and customizable products.
Fatima thinks the younger generation is trying to have closer ties with customers. It’s also important to her business to have sustainable practices and use ethically sourced materials.
“I think that’s what sets other small businesses in Tik Tok and Gen Z apart, compared to Amazon and all the other famous brands,” she said.
Eighty-six percent of RBC survey respondents agree that small businesses are able to deliver products that are tailored to local needs, and 73% believe that small businesses are able to innovate faster than larger businesses.
Canadians’ desire to shop locally prompted 39% of respondents to start their own business, according to the RBC survey.
Fatima was motivated by her love of Greek mythology.
“It’s something I resonated with as a kid, reading Percy Jackson books and learning about him in 4th grade social studies class, where I first encountered him. times,” she said. “So the emotional connection was very important to me.”
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