Cato Pastoll is CEO of Lending Loop and a member of the Council of Canadian Innovators.

Open this photo in gallery A pedestrian walks along empty street and closed shops in the Byward Market in Ottawa in this file photo from March 23, 2020. DAVE CHAN/AFP/Getty Images

No one planned for this. COVID-19 has brought the global economy to a standstill. With many provinces closing non-essential businesses, and consumption and consumer confidence decreasing, many Canadian small businesses are looking at extinction.

Businesses surveyed by Lending Loop, on average, have less than 30 days of cash on hand to weather this storm. This is not a new finding. In 2016, a JP Morgan study showed that the average restaurant, retailer and manufacturer had 16, 19 and 30 days of cash on hand, respectively. As revenue declines continue in the coming weeks and months, their futures look incredibly bleak.

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By all accounts, the federal government knows small and medium-sized businesses constitute the backbone of our economy because they support at least 70 per cent of all jobs in Canada. Yet, the majority of our governments’ efforts are dedicated to supporting individuals and not businesses. While the enhanced Employment Insurance programs are helpful measures, the disappearance of our businesses would mean there would be no jobs to return to once the pandemic is over.

The importance of small and medium-sized businesses in Canada cannot be overstated. Canadian small businesses make up 41.7 per cent of our GDP. Businesses with fewer than 10 employees make up 73.5 per cent of the private-sector employers in Canada. From 2013 to 2018, 56.8 per cent of all new jobs were created by small businesses. To put these numbers into perspective, small businesses in Canada collectively employ six times more Canadians than large Canadian businesses. In Canada, they are the giants of our prosperity.

At Lending Loop, we have supported Canada’s small-business community with financing for five years. Over the past week, our team has collected data every day from Canada’s small-business community, and the picture these data paint is more concerning than anyone could have imagined: While the magnitude of the effects of COVID-19 do depend on the industry and size of business, almost every single small-business owner is staring at the possibility of closing their doors for good.

Small businesses in the food service, travel and tourism, retail and education industries are looking at March revenue declines of 70 per cent or more. Revenue declines of this magnitude will initially result in layoffs, delaying payment to vendors and suppliers (other small businesses), and eventual closure. As layoffs continue to grow, consumer demand will decline significantly, further compounding the economic challenges for our economy.

Governments around the world have understood the role of small and medium-sized businesses in the health of their national economies, and have begun to take swift action. Britain has announced that 80 per cent of payrolls for private companies will be paid by the government, in addition to offering an emergency loan program for businesses, which is expected to include a guarantee program utilizing fintech lenders that can deploy capital quickly. In Denmark, the government is covering 75 per cent of wages to avoid mass layoffs. The U.S. government is currently voting on a stimulus package that includes significant payroll support for small businesses.

While Business Development Canada has been given more funds to lend, most Canadian small businesses are not eligible to access their loan programs and one Crown corporation cannot possibly deal with the magnitude of this issue alone. Solutions such as the 10-per-cent wage subsidy, and deferred tax and hydro bills barely scrape the surface of the problem. No current measure in Canada goes far enough to keep small businesses - your local restaurant, coffee shop, retailer, bookstore, hair stylist or wellness provider - alive or with any viable prospect of future return.

We know the federal government will step in for the banks, airlines and oil companies, but Canadians need our municipal, provincial and federal governments to step in and support the real engine of our economy: small businesses. Every small business in Canada is on a countdown clock to extinction. We would not recognize our country without them.