Community Futures Program Performance Report
ROUND ONE (2003-08)
Performance Measurement Division
Policy and Strategic Direction Sector
October 2013
Community Futures Performance Report
Table of Contents
List of Acronyms ............................................................................................................................................ 3
EXECUTIVE SUMMARY .................................................................................................................................. 4
MATCHING PROCESS..................................................................................................................................... 5
Methodology............................................................................................................................................. 5
RESULTS ........................................................................................................................................................ 7
Share of Firms by Industry and Penetration Rate ..................................................................................... 7
Table 1: Employment Performance .......................................................................................................... 9
Table 2: Business Survival Rates ............................................................................................................. 11
Table 3: Sales Performance..................................................................................................................... 12
CONCLUSION............................................................................................................................................... 14
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Community Futures Performance Report
List of Acronyms













AC
ACOA
ALU
BN
BR
CED-Q
CFP
FedDev
FedNor
GIFI
LEAP
RDA
WD
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Atlantic Canada
Atlantic Canada Opportunities Agency
Average Labour Unit
Business Number
Business Register
Canada Economic Development for Quebec Regions
Community Futures Program
Federal Economic Development Agency for Southern Ontario
Canada's regional development organization for Northern Ontario
General Index of Financial Information
Longitudinal Employment Analysis Program
Regional Development Agency
Western Economic Diversification Canada
Community Futures Performance Report
EXECUTIVE SUMMARY
This report is the first test of a new method to assess Community Futures loan client success by
comparing several indicators of business success: employment and payroll growth, sales growth and exit
and entry (firm longevity). Suppression issues prevented analysis of firm longevity; however, the
employment and sales data show positive results:

In terms of employment, CFP assisted firms grew at a compounded annual rate of 13.7% per
year compared to 8.2% for non-assisted firms, from 2003 to 2008. Small CFP-assisted firms (less
than 20 Annual Labour Units or ALUs) grew at a higher rate than small non-assisted firms (15.8%
versus 8.6%). However, medium-sized CFP-assisted firms (20 to 100 ALUs) tended to do less well
than the group of comparable firms in terms of job growth (6.1% versus 7.2%).

In terms of sales, CFP assisted firms grew at a compounded annual rate of 25.8% compared to
20.1% for non-assisted firms from 2003 to 2008. Smaller CFPassisted firms increased their sales
by 24.6%, compared to 16.6% for comparable firms. Medium-sized CFP-assisted firms increased
their sales faster than comparable firms as well (33.7% versus 30.2%).

CFs were able to obtain business numbers for 2,071 active clients. 1,098 of those clients were
found in the Statistic Canada’s Business Register and 683 (33%) were able to be linked to the
Longitudinal Employment Analysis Program (LEAP). Those 683 clients reported a total payroll of
$101,433,287 in 2008, over 3022 ALUs, and sales of $431,774,050.
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Community Futures Performance Report
MATCHING PROCESS
Methodology
The project involves linking a database of Community Futures Program (CFP) assisted businesses to
several administrative data files from Statistics Canada to obtain performance indicators, such as
measures of employment, business entries and exits (start-ups) and financial performance indicators. A
list of CFP-assisted firms was provided to Statistics Canada by each regional development agency (RDA).
Each record was linked to Statistics Canada's Business Register (BR) using the business number (BN) and
postal codes provided by the RDA’s. Only perfect matches on the business number were considered.
Among those matches, only records defined as being from an enterprise were kept since the
Longitudinal Employment Analysis Program (LEAP) file and the General Index of Financial Information
(GIFI) are built at the enterprise level.
An enterprise, as a statistical unit, is defined as a business unit that directs and controls the allocation of
resources relating to its operations, and for which consolidated financial and balance sheet accounts are
maintained. Each business defined as an enterprise in the BR has a statistical number called
‘EnterpriseId’.
The records were then linked to the LEAP and GIFI files using an EnterpriseId as a matching key. The
table below shows the match rate between the CFP client list and the different administrative data files.
Results from the Matching Process by Regional Development Agency
ACOA
CED-Q
FedDev
FedNor
Number of records
2,173
3,948
1,243
594
Share of firms found in the BR
1565 (72%) 2685 (68%)
796 (64%)
392(66%)
Share of firms found in the BR
910 (42%) 1325 (34%)
436 (35%)
226 (38%)
and linked to the LEAP
Share of firms found in the BR
607 (28%) 1111 (28%)
304 (24%)
155 (26%)
and linked to the GIFI
Sample size required for a 95% confidence level and a margin of error of…
5%
338
363
303
239
10%
96
98
93
86
WD
2,071
1098 (53%)
683 (33%)
437 (23%)
335
95
WD had a lower proportion of records found in the BR than the other RDAs. Western CFPs were
collecting business numbers for the first time and CFPs needed to go back to clients to obtain this
information. This may have resulted in a larger proportion of invalid numbers or numbers that are no
longer in the BR for WD than for other RDAs.
Statistics Canada also produced a set of tables for a group of firms that did not receive any support
under the CFP. The performance results for CFP-assisted firms can be evaluated in comparison to the
“comparable group of firms” with the purpose of controlling for economic conditions. The comparable
group is a set of firms that are similar in size (employment level), industrial sector, and geography (using
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Community Futures Performance Report
the postal codes of CFP-assisted firms). The comparable group of non-assisted firms are then compared
to the group of CFP-assisted firms by:




share of firms by industry and penetration rates;
employment growth;
business survival rates; and
sales growth.
Statistics Canada provided us with data from the LEAP and GIFI matching processes. For those firms
matched to the LEAP, data for employment, payroll, and number of enterprises were only provided for
the years 2003 and 2008. In contrast, financial data for firms matched to the GIFI were provided for the
years 2003 thourhg 2008. We chose to calculate measures for the share of firms by industry,
penetration rates, and employment growth using the dataset retrieved from the LEAP matching process.
Results for sales growth are taken from firms that were matched to the GIFI.
Growth rates are calculated using a compounded annual growth rate. Since growth in terms of sales or
employment is not constant over a five year period, an average annual growth rate can be misleading
and can underestimate or overestimate growth rates. The average annual growth rate and compounded
annual growth rate are as follows:
𝐴𝑣𝑒𝑟𝑎𝑔𝑒 𝐴𝑛𝑛𝑢𝑎𝑙 𝐺𝑟𝑜𝑤𝑡ℎ 𝑅𝑎𝑡𝑒 =
𝑇𝑜𝑡𝑎𝑙 𝐺𝑟𝑜𝑤𝑡ℎ 𝑅𝑎𝑡𝑒
# 𝑜𝑓 𝑦𝑒𝑎𝑟𝑠
1
# 𝑜𝑓 𝑦𝑒𝑎𝑟𝑠
𝐸𝑛𝑑 𝑉𝑎𝑙𝑢𝑒
𝐶𝑜𝑚𝑝𝑜𝑢𝑛𝑑𝑒𝑑 𝐴𝑛𝑛𝑢𝑎𝑙 𝐺𝑟𝑜𝑤𝑡ℎ 𝑅𝑎𝑡𝑒 = (
)
−1
𝐵𝑒𝑔𝑖𝑛𝑛𝑖𝑛𝑔 𝑉𝑎𝑙𝑢𝑒
As this is the first iteration of this analysis, it establishes a baseline for future analyses, which will allow
for greater confidence in the conclusions and identification of trends.
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Community Futures Performance Report
RESULTS
This section presents the result for CFP-assisted firms in Western Canada. The performance results for
CFP-assisted firms in other parts of Canada will be carried out by the respective RDA. Data tabulations
are presented by industry and business size. However, the following industries are excluded from the
data tabulations: the public sector (education services, health care and social assistance, and public
administration); the oil and gas extraction sector; the utilities sector; and the finance and insurance
sector. Furthermore, large firms, those employing more than 100 employees (defined as average labour
units–ALUs), are also excluded from the data tabulations.
Share of Firms by Industry and Penetration Rate
The following table presents the distribution of firms by industry for the reference year (2008) for both
the CFP-assisted firms and the firms from the comparable group. The data used to compile these two
measures were from firms matched to the LEAP. The share of firms by industry is helpful when
interpreting the results because it demonstrates the importance of a specific industry relative to the
entire pool of CFP-assisted firms.
Share of Firms by Industry for Western Canada (2008)
Industry
Enterprise size
CFP-Assisted Comparable
(ALU)
Firms
Group
Less than 100 ALU's
100.0%
100.0%
Less than 20 ALU's
97.5%
96.9%
Total (All selected NAICS)
20 to 100 ALU's
2.5%
3.1%
Agriculture, Forestry, Fishing and Hunting
Less than 100 ALU's
4.4%
13.2%
Mining (excluding Oil and Gas Extraction)
Less than 100 ALU's
1.8%
3.2%
Construction
Less than 100 ALU's
10.7%
16.8%
Manufacturing
Less than 100 ALU's
7.9%
3.6%
Wholesale Trade
Less than 100 ALU's
3.7%
3.3%
Retail Trade
Less than 100 ALU's
18.4%
9.7%
Transportation and Warehousing
Less than 100 ALU's
9.5%
6.7%
Information and Cultural Industries
Less than 100 ALU's
1.5%
0.7%
Real Estate and Rental and Leasing
Less than 100 ALU's
X
4.4%
Professional, Scientific and Technical Services Less than 100 ALU's
5.7%
12.4%
Management of Companies and Enterprises
Less than 100 ALU's
X
1.8%
Administrative and Support, Waste
Less than 100 ALU's
6.1%
5.0%
Management and Remediation Services
Arts, Entertainment and Recreation
Less than 100 ALU's
2.8%
1.8%
Accommodation and Food Services
Less than 100 ALU's
11.6%
6.4%
Other Services
Less than 100 ALU's
14.1%
11.0%
Source: Business Special Surveys and Technology Statistics Division, Statistics Canada, 2011.
( X ) Data suppressed for confidentiality purposes.
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Community Futures Performance Report
Nearly all CFP-assisted firms (97.5%) are small businesses (less than 20 employees). A similar
representation of firms’ sizes are shown in the sample of comparable firms.
Retail trade comprises the largest share of CFP-assisted firms (18.4%), followed by Other Services1
(14.1%) and Accommodation and Food Services (11.6%). Construction (10.7%) and Transportation (9.5%)
also rank high.
The penetration rate is included in the following table and is defined as the share of CFP-assisted firms
that were matched to total businesses. The penetration rate is calculated by dividing the number of CFPassisted firms by the number of total firms (CFP-assisted firms plus the comparable firms) for a
particular year and sector. The penetration rate is helpful when interpreting data because it
demonstrates how significant CFP-assisted firms are present in a particular year and industry.
Penetration Rate of CFP-Assisted Firms by Industry in Western Canada (%)
Enterprise size
Industry
2003
(ALU)
Less than 100 ALU's
0.3%
Less than 20 ALU's
0.3%
Total (All selected NAICS)
20 to 100 ALU's
0.4%
Agriculture, Forestry, Fishing and Hunting
Less than 100 ALU's
0.1%
Mining (excluding Oil and Gas Extraction)
Less than 100 ALU's
X
Construction
Less than 100 ALU's
0.2%
Manufacturing
Less than 100 ALU's
1.0%
Wholesale Trade
Less than 100 ALU's
0.4%
Retail Trade
Less than 100 ALU's
0.5%
Transportation and Warehousing
Less than 100 ALU's
0.5%
Information and Cultural Industries
Less than 100 ALU's
1.2%
Real Estate and Rental and Leasing
Less than 100 ALU's
X
Professional, Scientific and Technical Services Less than 100 ALU's
0.1%
Management of Companies and Enterprises
Less than 100 ALU's
X
Administrative and Support, Waste
Less than 100 ALU's
0.4%
Management and Remediation Services
Arts, Entertainment and Recreation
Less than 100 ALU's
0.6%
Accommodation and Food Services
Less than 100 ALU's
0.6%
Other Services
Less than 100 ALU's
0.5%
2008
0.5%
0.5%
0.4%
0.2%
0.3%
0.3%
1.0%
0.5%
0.9%
0.7%
1.0%
X
0.2%
X
0.6%
0.7%
0.9%
0.6%
Source: Business Special Surveys and Technology Statistics Division, Statistics Canada, 2011.
( X ) Data suppressed for confidentiality purposes.
1
NAICS 81, Other Services (except Public Administration) includes Repair and Maintenance (automotive,
electronics, machinery, household goods), Personal and Laundry Services (grooming, funeral, laundry, pet care,
photography), and Religious, Grant-Making, Civic, Professional and Similar Organizations.
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Community Futures Performance Report
Table 1: Employment Dynamics
This section looks at employment trends for firms that have received assistance under the CF over a fiveyear period and compares the results to a group of comparable firms. The following graph shows the
number of employees across all firms and industries in Western Canada that were employed by CFPassisted and non-assisted firms. In 2003, 346 CFP-assisted firms employed over 1,593 ALUs. Five years
later in 2008, the CFP expanded their influence to 683 firms that in turn employed over 3022 ALUs. This
resulted in a compounded annual job growth rate of 13.7%. The comparable group had 99,690 firms
employ over 376,098 ALUs in 2003, and later in 2008 there were 142,801 firms that employed over
557,462 ALUs. This resulted in a compounded annual growth rate of 8.2% for comparable firms.
Total ALUs for Firms of All Sizes in Western Canada
Across All Industries
(LEAP: 2003 & 2008)
600
3500
3000
2500
2000
1500
1000
500
0
500
400
300
200
100
0
2003
Comparable Group (left axis)
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2008
CF Assisted Firms (right axis)
Community Futures Performance Report
The following table presents the results of compounded annual employment growth rates from net job
creation between 2003 and 2008 by industry.
Compounded Annual Growth in Employment by Industry in Western Canada (2003-2008)
Enterprise size
CFP Assisted
Comparable
Industry
(ALU)
Firms
Group
Less than 100 ALU's
13.7%
8.2%
Total (All selected NAICS)
Less than 20 ALU's
15.8%
8.6%
20 to 100 ALU's
6.1%
7.2%
Agriculture, Forestry, Fishing and Hunting
Less than 100 ALU's
10.4%
0.9%
Mining (excluding Oil and Gas Extraction)
Less than 100 ALU's
28.4%
11.5%
Construction
Less than 100 ALU's
20.5%
14.2%
Manufacturing
Less than 100 ALU's
11.5%
6.9%
Wholesale Trade
Less than 100 ALU's
12.0%
5.0%
Retail Trade
Less than 100 ALU's
12.9%
7.7%
Transportation and Warehousing
Less than 100 ALU's
13.9%
8.2%
Information and Cultural Industries
Less than 100 ALU's
15.5%
7.6%
Real Estate and Rental and Leasing
Less than 100 ALU's
31.7%
8.7%
Professional, Scientific and Technical Services Less than 100 ALU's
19.0%
9.2%
Management of Companies and Enterprises
Less than 100 ALU's
12.5%
12.0%
Administrative and Support, Waste
Management and Remediation Services
Less than 100 ALU's
15.6%
11.1%
Arts, Entertainment and Recreation
Less than 100 ALU's
4.3%
3.9%
Accommodation and Food Services
Less than 100 ALU's
12.2%
8.8%
Other Services
Less than 100 ALU's
15.0%
5.3%
Source: Business Special Surveys and Technology Statistics Division, Statistics Canada, 2011.
In general, the group of CFP-assisted firms outperformed the comparable group and grew at a
compounded annual growth rate of 13.7% compared to 8.2% for non-assisted firms. Employment
growth was higher for smaller CFP-assisted firms across industries. However, medium-sized CFP-assisted
firms grew at a slower pace than comparable firms (6.1% versus 7.2%). The reason for this is not clear, it
is possible that some medium-sized firms experience downsizing during operation as an effort to remain
in business.
By industry, the results are more nuanced. The difference between CFP-assisted firms and comparable
firms is noteworthy in Real Estate and Rental and Leasing (31.7% as opposed to 8.7%) though the
number of CFP-assisted firms in these industries is very small (exact counts were suppressed for 2003,
but there were only 7 CFP-assisted firms in this industry category that had been fully matched in 2008).
Other notable differences were in Agriculture, Forestry, Fishing and Hunting, Mining, Professional,
Scientific and Technical Services, as well as Other Services.
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Community Futures Performance Report
In both CF-assisted and non-assisted groups, the most job growth occurred in firms with fewer than 20
ALUs. The small number of medium-sized firms show less growth for CFP-assisted firms than for nonassisted firms.
Annual Employment Growth in Western Canada for
Firms with Less than 100 ALUs
LEAP: 2003 & 2008
16%
14%
12%
10%
8%
6%
4%
2%
0%
Total
Retail Trade
CFP-Assisted Firms
Other Services
Comparable Group
Accommodation and
Food Services
The chart above compares employment growth for CFP-assisted firms and non-assisted firms in the top
3 industries in which Western Canadian CFs issued loans.
Table 2: Business Survival Rates
Entries and exits data are used to calculate the business survival rate of firms over a given period of
time. The business survival rate represents the number of firms that have entered the market and are
still in business over this period. Business survival rates are calculated using the accumulative method.
The accumulative method gives the ratio of firms that have entered the market and are still operating
over the total number of firms that entered the market over a specific period of time.
The suppression rate in Table 2: Entries and Exits is exceedingly high. As a result, the business survival
rate of CF-assisted firms cannot be calculated. This is the case for all regions in Canada for CF-assisted
businesses.
Note: For subsequent reports analysis of firm longevity will be included as data suppression poses less of
an issue.
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Community Futures Performance Report
Table 3: Sales Growth
Table 3 presents financial information for incorporated businesses that have received assistance under
the CFP and for a group of comparable firms.
The graph below shows the sales for CFP-assisted firms and the comparable group for all industries and
all business size. Total sales for both the CFP-assisted firms and the comparable group consistently
increased over the five year period, despite weaker economic conditions in the latter part of 2008.
Sales for CFP-assisted firms totalled $431.8M in 2008, up from $137.1M in 2003. This represents a
compounded annual increase of 25.8% per year. In comparison, sales of comparative firms rose from
$44,729.4M in 2003 to $111,643.6M in 2008, representing a compounded annual increase of 20.1% per
year.
120000
Total Sales for Firms in Atlantic Canada with Less
than 100 ALU's in All Industries
GIFI: 2003-2008
500
($ millions)
400
80000
300
200
40000
100
0
0
2003
2004
2005
Comparable Firms (left axis)
2006
2007
2008
CF Assisted Firms (right axis)
Sales by medium-sized enterprises for both CFP-assisted and comparable firms grew less than the small
firms over the 2003-2008 period. For medium-sized firms in the CF-assisted group, compounded annual
growth was 24.6% per year, compared to 16.6% per year for the non-assisted group. For small firms, the
CFP-assisted group experienced much higher growth (33.7% per year) and the non-assisted group of
small businesses enjoyed slightly lower compounded growth at 30.2% per year.
By industry, the picture is mixed for sales. While most firms in the CFP-assisted group experienced
higher growth than the comparable groups, this was not true for the Agriculture, Forestry, Fishing and
Hunting (n=23); Wholesale Trade (n=17); Management of Companies and Enterprises (n=X);
Administration and Support, Waste Management and Remediation Services (n=17) or Arts,
Entertainment and Recreation (n=13). Where CFP-assisted firms experiences the greatest amount of
sales growth compared to comparable firms is in the Other Services category (18.5% higher growth than
comparable firms, n=50), Mining (excluding Oil and Gas Extraction) (16.7% higher, n=X) and in Real
Estate, Rental and Leasing (12% higher, n=X).
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Community Futures Performance Report
Compounded Annual Sales Growth by Industry in Western Canada (2003-2008)
Enterprise size
CFP-Assisted Comparable
(ALU)
Firms
Group
ALL SIZES
25.8%
20.1%
LESS THAN 20
Total (All selected NAICS)
ALU's
24.6%
16.6%
20 to 100 ALU's
33.7%
30.2%
Agriculture, Forestry, Fishing and Hunting
ALL SIZES
11.4%
12.9%
Mining (excluding Oil and Gas Extraction)
ALL SIZES
46.9%
30.2%
Construction
ALL SIZES
35.3%
23.7%
Manufacturing
ALL SIZES
23.1%
14.4%
Wholesale Trade
ALL SIZES
14.9%
29.0%
Retail Trade
ALL SIZES
24.9%
15.1%
Transportation and Warehousing
ALL SIZES
27.1%
15.9%
Information and Cultural Industries
ALL SIZES
26.0%
16.2%
Real Estate and Rental and Leasing
ALL SIZES
30.2%
18.2%
Professional, Scientific and Technical Services ALL SIZES
24.9%
18.8%
Management of Companies and Enterprises
ALL SIZES
15.6%
20.9%
Administrative and Support, Waste
Management and Remediation Services
ALL SIZES
24.0%
30.5%
Arts, Entertainment and Recreation
ALL SIZES
7.8%
9.9%
Accommodation and Food Services
ALL SIZES
18.7%
16.1%
Other Services
ALL SIZES
35.1%
16.6%
Industry
Source: Business Special Surveys and Technology Statistics Division, Statistics Canada, 2011.
( X ) Data suppressed for confidentiality purposes.
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Community Futures Performance Report
CONCLUSION
Using the firm tracking data compiled by Statistics Canada, the performance of CFP-assisted firms is
compared in terms of employment growth, payroll growth, business survival rate and sales growth to a
group of comparable firms that did not receive assistance. With the exception of the business survival
rate, the three remaining indicators can be calculated and reported in the CF performance
measurement strategy. The business survival rate for CFP-assisted firms cannot be calculated because of
data suppression issues. With the assisted firms as whole, one can draw confident conclusions. By
industry, the analysis is more tentative, due to small numbers of cases.
The data demonstrates that Community Futures organizations’ lending activity is making a difference, as
CFP-assisted firms perform better than the comparable group in terms of growth in employment,
payroll, and sales. While it is difficult to discern whether or not a firm downsizes or stops doing business,
it is possible that the effort of medium-sized firms to downsize their labour in an effort to remain in
business in the community is a contributing variable to the slower paced job growth rate. Future reports
will keep this in mind, and evaluate the future performance in job growth, sales growth, and firm
longevity.
October2013
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