All provinces see confidence drop in April

Regina, April 26, 2018 - Today, the Canadian Federation of Independent Business (CFIB) released its latest monthly Business Barometer®, which reveals optimism among small business owners in Saskatchewan declined in April to an index of 54.6, down from 62.0 in March and now below the national average index of 56.6.

“After several months of improved optimism, Saskatchewan's Business Barometer Index saw small business optimism decline more than 7 points to reach 54.6—the second lowest level after Newfoundland,” said Marilyn Braun-Pollon, CFIB’s Vice-President, Prairie & Agri-business. “Employment plans are also weak with 15 per cent of owners looking to hire staff and 20 per cent planning lay-offs.”

Entrepreneurs’ concerns about taxes and regulatory costs also remained at a record high again in April at 70 per cent. “There are a number of clouds on the horizon as business owners across the country are facing many cost increases and much uncertainty,” noted Braun-Pollon. “The rail backlog, delayed Spring, ongoing concerns surrounding the federal tax changes and the threat of a federally-imposed carbon tax weigh heavy on the minds of Saskatchewan entrepreneurs. The ongoing challenges around the potential delay of the Trans Mountain Pipeline project adds to these growing concerns - a problem created by the BC government.”

“With 76 per cent of Saskatchewan small businesses opposed to a carbon tax, we commend the Saskatchewan government for standing up and challenging the federal government’s ability to impose a costly carbon tax on the province,” added Braun-Pollon. “We are urging the provincial government to stand up again for small businesses and NOT follow the federal government in limiting businesses’ access to the small business deduction based on passive investment revenue.”

Nationally, small business confidence fell for the third consecutive month in April, with the index dropping more than four points to 56.6, the third lowest reading in the past decade.

“The only other times confidence was this low, was during the 08-09 economic crisis and the 2015-16 energy price crunch” said Andreea Bourgeois, CFIB senior analyst. “Hiring plans remain weak for this time of year, although measures for general business health, investment plans and new orders are steady. With declines in confidence in all 10 provinces and 11 out of 13 industries, there’s just not a lot of optimism amongst Canada’s small business communities.”

Provincial Results: down across the board

Quebec returned to the top spot for small business confidence levels in the country at 68.7, despite dropping nearly four points in April. Nova Scotia fell seven, but still sits 12 points above the lagging national average. Saskatchewan also saw largest major confidence regression, falling 7.4 points to 54.6.

Highlights of the Saskatchewan Business Barometer for April:

• 32% of businesses in Saskatchewan say their overall state of business is good (39% nationally); 16% say it is bad (13% nationally).
• 20% plan to decrease employment in the next 3-4 months (14% nationally) and only 15% of Saskatchewan businesses plan to increase full-time employment (20% nationally).
• Insufficient domestic demand remains the main operating challenge (48%), followed by shortage of skilled labour (28%), and management skills, time constraints (25%).
• Major cost pressures for small business include: tax, regulatory costs (70%), insurance costs (54%) and wage costs (49%).

Measured on a scale of 0 and 100, an index level above 50 means owners expecting their business’ performance to be stronger in the next year outnumber those expecting weaker performance. April 2018 findings are based on 740 responses, collected from a stratified random sample of CFIB members, to a controlled-access web survey. Data reflect responses received through April 16. Findings are statistically accurate to +/- 3.6 per cent 19 times in 20.

To arrange an interview with Marilyn Braun-Pollon, Vice-President Prairie & Agri-business on the provincial results please call (306) 757-0000, 1-888-234-2232 or email mssask@cfib.ca. You may follow CFIB Saskatchewan on Twitter @cfibsk.

To arrange an interview with Andreea Bourgeois, CFIB senior analyst on the national results, please call (647) 464-2814 or email public.affairs@cfib.ca.

Business Barometer® is a monthly publication of the CFIB and is a registered trademark.

CFIB is Canada’s largest association of small and medium-sized businesses with 110,000 members (5,250 in Saskatchewan) across every sector and region.