Winnipeg, March 25, 2020 – Today, the Canadian Federation of Independent Business (CFIB) released its latest monthly Business Barometer®, which reveals optimism among small business owners in Manitoba dropped sharply in March to an index of 37.5, down 17.6 points from 55.1 in February. The index is now 6.7 points above the national average index of 30.8.
“While this fall in Manitoba’s Barometer index is not surprising given the COVID-19 pandemic, the devastation to small businesses so far cannot be overstated,” said Jonathan Alward, CFIB’s director, prairie region. “We are working with governments at every level and from every corner of Canada to provide measures to help ensure as many of our small, independent businesses can survive until the pandemic passes. More can and must be done to help.”
“We’ve appreciated the Government of Manitoba’s decision to extend tax payment filing deadlines for small businesses,” added Alward. “However, further action is needed to help businesses survive at this critical time.”
While last week’s federal economic measures were welcome initial steps, CFIB continues its call for a COVID-19 Job Retention Program that would subsidize wages of employers able to retain their staff. This would cover at least 75% of wages for all employers, up to a cap of $5,000 per worker per month. CFIB proposes the program include the self-employed and small business owners. “We need the federal government to move quickly and introduce a 75% wage subsidy to retain employees,” noted Alward. “We also need the federal government to end their carbon tax in Manitoba and put on hold CPP hikes.”
Nationally, small business confidence fell to a new historic low amid impacts of the COVID-19 pandemic. After a 10-point drop earlier in the month, the national confidence level fell a further 19 index points to 30.8 from February’s level of 60.5.
“March 2020 has turned out to be a month like no other in Canada’s economic history,” said Ted Mallett, CFIB’s vice-president and chief economist. “Small business sentiment has never been this low in the Business Barometer’s 32-year history, including during the 2008 and 1990 recessions.”
Provincial results: Sentiment crash across the country
Quebec experienced the sharpest drop in optimism this month, falling 44.5 index points to 15.7. It is possibly due to the province taking quicker and more drastic measures than other provinces to halt the COVID-19 outbreak. Alberta (26.2) and Newfoundland and Labrador (27.8) had the next lowest results, although they experienced the smallest drops in optimism. Saskatchewan (28.3) and British Columbia (28.8) both posted levels close to the national average after experiencing 16-point drops, while Ontario (37.0) and Manitoba (37.5) fared a bit better. Nova Scotia (44.0) and New Brunswick (44.6) both experienced large drops in confidence, but remained more upbeat than the rest of the country.
Highlights of the Manitoba Business Barometer for March:
- 14% of businesses in Manitoba say their overall state of business is good (20% nationally); 28% say it is bad (38% nationally);
- 9% plan to increase employment in the next 3 months (5% nationally) and 43% of Manitoba businesses plan to decrease full-time employment (50% nationally);
- Insufficient domestic demand (37%) and shortage of skilled labour (37%) are the main operating challenges, followed by management skills, time constraints (25%);
- Major cost pressures for small business include: tax, regulatory costs (71%), wage costs (56%) and fuel, energy costs (52%).
Changes in Barometer release schedule
CFIB normally releases the results of its Barometer on the final Thursday of each month. Due to rapidly evolving economic conditions impacted by the global COVID-19 pandemic, CFIB will increase the frequency of its Business Barometer Survey from monthly to bi-monthly through June 2020. CFIB will release results for early April on April 9.
Read the March Business Barometer®
Mid-March 2020 findings are based on 1,378 responses, collected from a stratified random sample of CFIB members, to a controlled-access web survey. Data reflects responses received on March 17 and 18. Findings are statistically accurate to +/- 2.6 per cent 19 times in 20. 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 perform. One normally sees an index level of between 65 and 70 when the economy is growing at its potential.
To arrange an interview with Jonathan Alward, CFIB’s director, prairie region on the provincial results, please call 431-998-4498 or email [email protected]. You can also follow CFIB Manitoba on Twitter @cfibMB.
To arrange an interview with Ted Mallett, CFIB’s vice-president and chief economist on the national results please contact Milena Stanoeva at 647-464-2814 or [email protected].
CFIB is Canada’s largest association of small and medium-sized businesses with 110,000 members (4,800 in Manitoba) across every sector and region. CFIB is dedicated to increasing business owners’ chances of success by driving policy change at all levels of government, providing expert advice and tools, and negotiating exclusive savings. Learn more at cfib.ca.