Business Barometer®: optimism amongst small biz slips again in July
Ted Mallett, Vice-President & Chief Economist
Following a bigger decline in June, small business optimism eased again slightly in July. The Business Barometer® Index finished the month at 63.2, about a third of point under its June level of 63.5, and its lowest reading since last December.
On a scale between 0 and 100, an index above 50 means owners expecting their business’ performance to be stronger in the next year outnumber 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 and Newfoundland and Labrador remain the country's most optimistic, registering index levels above 72. Albertans are close, behind, though their score has dropped below the 70-mark. Manitoba and Saskatchewan are just a shade above the national average, while sentiment from Ontario through to Prince Edward Island are mired around a lacklustre index level of 60--a slight improvement for the Maritimes, but slippage in Central Canada
The main drag on optimism is coming from business owners engaged in hospitality, construction and agriculture, while it is most robust in natural resources, manufacturing and the information sectors.
The current labour scene, though, remains reasonably upbeat. The 22 per cent of owners hoping to hire full-timers versus 9 per cent expecting to shed is slightly better than July 2013 and the strongest post-recession signal yet for this time of year. At the same time it has brought about a spike in concern over the availability of skilled labour.