'Shopify effect': Software giant's merchants generated US$444B in economic activity in 2021, company says

Shopify sign with cart

Merchants who power their e-commerce sites on Shopify’s platform helped support five million jobs last year and generated more than US$444 billion in global economic activity – a 45 per cent jump from 2020, the Ottawa-based software giant says in its latest economic impact report.

A sizable chunk of those spinoffs are created in Shopify’s homeland, the company said Thursday. 

Canadian merchants on Shopify’s platform pumped US$23.8 billion into the country’s economy and helped create more than 142,000 jobs, according to the study conducted in partnership with Deloitte Canada.

That compares favourably with the United Kingdom, where Shopify merchants generated US$35.1 billion in economic activity and helped create more than 197,000 jobs. And it’s not far behind Australia, which – despite its smaller population – benefited even more from the so-called “Shopify effect,” to the tune of US$29.6 billion in economic activity and the creation of just over 154,000 jobs.

Not surprisingly, the United States was the biggest beneficiary of Shopify merchants’ revenue- and job-creation prowess. Online store operators using its platform in the U.S. generated almost $240 billion in profits, labour income and tax revenues, the company said, while they supported employment for nearly one million workers.  

Researchers combed Shopify merchant databases as well as third-party data collected by Deloitte Canada to come up with the findings.

The report suggests that Shopify merchants in Canada also did well selling their wares beyond the country’s borders.

Shopify's Canadian e-commerce retailers exported US$2.4 billion worth of goods and services last year, a 21 per cent increase from 2020. 

The report comes as Shopify’s stock is on a slide that’s seen it shed nearly 70 per cent of its value since last November. 

Shopify shares were priced at $566.10 near the close of Thursday’s trading on the Toronto Stock Exchange, down from a high of more than $2,200 less than six months ago. The firm is set to report financial results from its first quarter ending March 30 next Thursday morning.