Small and medium enterprises (SMEs) (below 500 employees) employ more than 90% of the private labour force and provide nearly 60% of all jobs in Canada. Therefore, to achieve inclusion of all underrepresented groups at work, policy makers must focus on helping these employers develop robust diversity and inclusion practices.
While much of the policy focus on diversity in SMEs has been on improving access to capital for women and other underrepresented groups to form or grow businesses, a larger impact might come from attending to all SMEs and their ability to implement diversity and inclusion in their work. This would be helpful not only for business owners in general, but also the 16% of SMEs that are owned and operated by women. Many or all of these enterprises are subject to laws and regulations mandating equal treatment, such as the Human Rights code, pay equity and pay transparency legislation, parental leave, and other. At the same time, SMEs do not necessarily have the scale for full-time human resources managers, nor the capacity to implement and assure compliance. Further, smaller businesses may not perceive they have the resources to appropriately address these issues. Unfortunately, little research has been done on what SMEs are doing or what they might do to promote equality for all. This policy brief summarizes what is known about diversity and inclusion in SMEs in the Canadian context and what could be done going forward.