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Zombie firms are businesses that persistently perform poorly over time without exiting, and their prevalence has been rising over time across many advanced economies. They negatively affect economic growth as they tend to be unproductive and compete with other healthy firms for scarce resources. In Canada, while the share of zombie firms was falling leading up to the COVID-19 pandemic, they were becoming less productive over time, were negatively affecting healthy firms and were increasingly lowering aggregate productivity. In 2019, aggregate productivity would have been up to 5% higher had zombie firms exited (Amundsen et al., 2023). From 2020 to 2022, aggregate labour productivity declined in the business sector in Canada. Of interest is the potential long-term effects of the economic downturn that accompanied the pandemic. In addition, a large amount of support was offered to sustain Canadian businesses during the pandemic, including the Canada Emergency Wage Subsidy (CEWS), the Canada Emergency Commercial Rent Assistance (CECRA), the Canada Emergency Rent Subsidy (CERS) and the Canada Emergency Business Account (CEBA). Some have noted that the scale and swift implementation of pandemic-related measures globally had the potential to accelerate zombification and constrain the post-pandemic recovery (for example, OECD, 2020). This article summarizes recent research by Amundsen et al. (2025) that examined zombie firm prevalence and the dynamics of these firms over the 2020-to-2022 pandemic years, the role of business supports in helping to prop up zombie firms or encourage their survival, and their contribution to the decline in Canada’s productivity. Zombie firms are defined as having earnings before interest and taxes less than their interest payments for 3 consecutive years and as being at least 10 years old.

This study compares the performance of businesses owned by women (majority or equal ownership) that patent with that of majority men-owned businesses and businesses where gender of ownership cannot be assigned. It finds that women-owned firms have higher survival rates, but lower revenue growth rates, after filing for a patent than businesses where gender of ownership cannot be assigned, even after controlling for observable firm characteristics. The differences between women-owned businesses and businesses where gender of ownership cannot be assigned are greater than those between women-owned and majority men-owned businesses. Women-owned businesses have lower revenue growth rates than majority men-owned businesses, but only have higher survival rates in the fifth year after filing for a patent and after controlling for observable firm characteristics. When the possibility of exit through an acquisition is taken into account, differences in survival between women-owned businesses and other businesses disappear. This suggests that women-owned businesses that patent may have different exit strategies than other businesses. The differences in revenue growth suggest that there may be differences in the quality of the invention, or that some previously documented differences in favour of men-owned businesses (i.e., access to financing and knowledge-building opportunities) may affect the type of inventions developed by women-owned businesses and their ability to successfully commercialize them. Overall, the findings support the need for policies that take gender into account.