Business Barometer®: Optimism on the rise again among small businesses
Ted Mallett, Vice-President & Chief Economist
Small business owners are showing a little more optimism in February. CFIB's Business Barometer® Index rose 0.4 points to 64.4 this month, expanding on its 1.7 point gain in January. The index is now running about half a point better than its average for 2013.
On a scale between 0 and 100, an index above 50 means owners expecting their business’performance to be stronger in the next yearout number those expecting weaker performance.One normally sees an index level of between 65 and 70 when the economy is growing at its potential
Business owners in British Columbia (71.4), Alberta (70.6) and Newfoundland & Labrador (67.2) are the most optimistic - little changed from a month earlier. Improvements were seen in Quebec (59.6) and Prince Edward Island (61.0), though their index levels remain below the national average. Business owners in Ontario (62.9) and Manitoba (58.7), on the other hand, saw index scores fall in February. Optimism in Saskatchewan (63.6), Nova Scotia (57.6) and New Brunswick (56.6) was virtually unchanged.
Sector profiles remain pretty tightly grouped around the overall average, with those in the information sector, professional services and manufacturing at the top of the scale.
Short-term hiring expectations are running reasonably well for this time of year, with 25 per cent expecting to add full-timers in the next 3-4 months, versus only 6 per cent who expect to cut back. The 60 per cent who expect to make capitalinvestments in short-term also matches a postrecession high. Of note, average pricing increases have shot up above 2 per cent as importers have had to react to recent shart declines in C$.