Regina, 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 Saskatchewan fell sharply in March to an index of 28.3, down from 47.6 in February. The index is now 2.5 points below the national average index of 30.8.
“It is extremely concerning to see Saskatchewan’s small business optimism dropped almost 20 points in March to 28.3 as a result of COVID-19 – a record low for the province. Clearly, entrepreneurs are feeling the significant impact of the pandemic,” said Marilyn Braun-Pollon, CFIB’s Vice-President, Western Canada and Agri-Business. “CFIB continues to hear from thousands of small business owners who are having to make difficult lay-off decisions and are struggling to keep their business afloat due to cash-flow problems and the extreme uncertainty.”
CFIB is 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 Saskatchewan’s decision to announce a financial support plan for Saskatchewan employers and employees impacted by COVID-19,” added Braun-Pollon. “We also recognize those municipalities that have already announced property tax and utility bill deferrals.”
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 Braun-Pollon. “We also need the federal government to put on hold the costly carbon tax and 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 Saskatchewan Business Barometer for March:
- 8% of businesses in Saskatchewan say their overall state of business is good (20% nationally); 58% say it is bad (38% nationally);
- 4% plan to increase employment in the next 3 months (5% nationally) and 56% of Saskatchewan businesses plan to decrease full-time employment (50% nationally);
- Insufficient domestic demand is the main operating challenge (57%), followed by shortage of skilled labour (28%) and shortage of working capital (22%).
- Major cost pressures for small business include: tax, regulatory costs (69%), fuel, energy costs (58%), and insurance 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®
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. One normally sees an index level of between 65 and 70 when the economy is growing at its potential. 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.
To arrange an interview with Marilyn Braun-Pollon, Vice-President, Western Canada & Agri-business on the provincial results please call 306-539-6302 or email mssask@cfib.ca. You may follow CFIB Saskatchewan on Twitter @cfibsk.
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 public.affairs@cfib.ca.
About CFIB
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. 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.