Small business confidence at its lowest since April 2020, CFIB report

by Staff

The Canadian Federation of Independent Business (CFIB) Business Barometer indicates its 12-month small business confidence index, saw a further drop of 1.5 points down to 47.2 in October. On a downward trend in recent months, the October reading is the lowest since the pandemic in April 2020 and the third-lowest monthly reading in close to 15 years. Numbers dropped across the country, with Quebec (46.1) and Ontario (46.5) registering the lowest long-term outlooks.

“While our Main Street Quarterly forecasts indicated last week that the economy will narrowly avoid a recession in the second half of this year, many signs still point to a lot of trouble for small businesses. We’re hearing from many businesses that they’re at full capacity and busy, but they’re not making a profit either. Inflation, financial pressures, labour challenges, uncertainty: name a business challenge and it’s happening in Canada right now,” said Simon Gaudreault, CFIB’s chief economist and vice-president of research, in a media release last week.

The same report indicates businesses’ average price and wage plans have shown improvement throughout 2023 and are sitting at 3.0% and 2.9% in October, respectively. This coupled with recent Bank of Canada announcement it would not further hike interest rates is seen as some good news.

October’s survey results show business owners worried about occupancy (29%), borrowing (44%), insurance (56%) and wage (66%) costs. Skilled labour availability continues to be a concern for 49% and is still higher than its historical average of 35%. 

“While the softening of the labour market as well as wage and price plans bring good news on the inflation front for businesses struggling to keep up with high costs, our different business indicators show their outlook remains quite difficult,” said Andreea Bourgeois, Director of Economics at CFIB. “And small businesses are very much wondering about what the next few months have in store, especially with the ongoing geopolitical situation and the looming Canada Emergency Business Account (CEBA) repayment deadline being less than three months away.”

Print Friendly, PDF & Email