Toronto, ON (July 3, 2014) – Small business optimism took a significant downturn over the last month, according to the Canadian Federation of Independent Business (CFIB). The Business Barometer® index for June fell over three points to 63.5 from last month’s reading of 67.1.
“Reduced optimism among business owners in Ontario, Manitoba and Saskatchewan has driven down the national numbers,” said Ted Mallett, CFIB’s chief economist and vice-president. “But we’re also seeing other provincial indicators on pattern, suggesting that this month’s drop is not the start of any kind of sustained trend.”
Measured on a scale of 0 to 100, an index level above 50 means owners expecting their businesses’ performance to be stronger in the next year outnumber those expecting weaker performance. According to past results, index levels normally range between 65 and 70 when the economy is growing at its potential.
Index readings in Ontario, Manitoba and Saskatchewan dropped to 61.9, 64.0 and 65.8 respectively, but optimism remained high in British Columbia (73.2), Alberta (72.6) and Newfoundland and Labrador (70.0). Quebec (62.0), Prince Edward Island (61.0) and New Brunswick (60.7) all gained some ground from last month, while Nova Scotia’s barometer reading fell by just under two points to 55.8.
“While the hospitality and construction sectors have seen the biggest dip in optimism across the board, there are still reasons to stay positive,” said Mallett. “New order indicators are strong, while 39 per cent of owners say their businesses are in good shape – and this trend continues to climb upward.”
Short-term hiring plans also remain reasonably good for this time of year and pricing and wage growth plans are pinned near the two-per-cent mark.
June 2014 findings are based on 1,042 responses, collected from a stratified random sample of CFIB members, to a controlled-access web survey. Data reflect responses received through June 16. Findings are statistically accurate to +/- 3.0 per cent 19 times in 20.
Read the June Business Barometer®.
About the Canadian Federation of Independent Business (CFIB)
With the strength of over 109,000 small business owners from coast-to-coast, the Canadian Federation of Independent Business is the big voice for small businesses. For over 40 years, we have represented the interests of the small business community to all three levels of government in their fight for tax fairness, reasonable labour laws and reduction of regulatory paper burden. CFIB is Canada’s largest association of small and medium-sized businesses.
SOURCE: Canadian Federation of Independent Business