BC index at lowest level in 3 1/2 years but remains 3rd highest in Canada
VANCOUVER<, January 28, 2016 – According to the latest monthly Business Barometer survey results from the Canadian Federation of Independent Business (CFIB), BC’s small business optimism dropped 3.1 points in January to 62.8.
Small business optimism declined for the second month in a row, down 8.9 points from the same time last year, and reaching its lowest level in three and a half years. However, despite the drop, the BC index remained the third highest in the country (tied with New Brunswick). BC’s margin over the national index (54.3) narrowed to 8.5 points.
Measured on a scale between 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. An index level of between 65 and 75 means the economy is growing at its potential.
“It appears BC independent businesses are reining in expectations for 2016, as increased uncertainty in neighboring provinces fuelled by low commodity prices and a weakening dollar have taken a toll on their outlook. In spite of declining growth prospects, entreprenreurs in the province remain generally positive about the current health of their own business”, says Richard Truscott, Vice President for BC and Alberta.
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The weakening dollar has increased input costs for many small businesses in BC. Nearly 35 per cent identify foreign currency as being a major input cost constraint, up from 21.5 per cent in January last year.
Hiring plans experienced an increase for the first time in six months, with 23 per cent of business owners saying they plan to increase full-time staff in the next three months. However, 10 per cent of businesss owners in January expect to cut back staff in the coming months, up two points since last month and the highest level in three years.
Forty-five per cent of entrepreneurs in January believe the general state of health of their business was good, up one point since December. That compares to just 9 per cent of business owners who describe it as poor, down two points from last month.
The national Business Barometer index fell 1.4 points in January to 54.3. The provincial numbers were: Nova Scotia (69.0), Newfoundland & Labrador (63.2), New Brunswick (62.8), Manitoba (61.4), Quebec (61.2), PEI (60.3), Saskatchewan (58.7), Ontario (58.4), and Alberta (28.8).
The January 2016 findings are based on 712 responses, collected from a stratified random sample of CFIB members, to a controlled-access web survey. Data reflect responses received through to January 18. Findings are statistically accurate to +/- 3.7 per cent 19 times in 20.
To arrange an interview with Richard Truscott, Vice-President for Alberta and BC, please call 604-684-5325. For more information about CFIB, visit cfib.ca. To interview Chief Economist, Ted Mallett, about the national results, please call 416-222-8022.
CFIB is Canada’s largest association of small- and medium-sized businesses with 109,000 members across every sector and region, including 10,000 in B.C.