That's like half the size of a smart phone screen lol. Some of the older postie might have trouble reading the address if it's printed on a label *that* small... I'd also imagine something that tiny would be more prone to go missing in the mail stream.....
But yes like the other posters suggested, it's waaaay too small and under Canada Post's minimal size requirement, and you should just use a bubble mailer that meets the requirement. You'd still be mailing it with the <100g parcel options anyway, since it's too thick for Lettermail.
I personally do resize my labels to 80% of original size (it fits my packages well and still readable) using the computer's default resizing option.