Toronto, January 26, 2017 – The Canadian Federation of Independent Business (CFIB) released its Business Barometer index today, showing small business confidence now stands at 60.1. Although optimism has stepped back a little in January from December readings, it is still showing more buoyancy than what we had seen though most of 2015 and 2016.
“It’s a bit of a mixed bag this month, but generally the numbers are holding steady,” said Ted Mallett, Chief Economist at CFIB. “We’re seeing some encouraging signs coming out of the resource-rich provinces, though we are keeping an eye on some other major indicators, like weaker-than-normal employment and capital spending plans.”
Improvements in the outlook among natural resources companies continues—and strength is also found in the manufacturing, professional services and information sectors. Unfortunately, optimism in the consumer-facing sectors—retail, hospitality and personal services—has tailed off, suggesting more caution in that side of the economy.
Regionally, however, conditions are remaining pretty consistent. Quebec business owners are the nation's most optimistic, with an index at 68.6. Owners in Newfoundland and Labrador, Alberta and Saskatchewan are considerably less upbeat, but the gap relative to the rest of the country is narrowing. Index levels in the remaining provinces are reasonably positive and tightly bunched in the mid-60s range.
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.
There is still a fair bit of caution built into the other major indicators surveyed. Employment plans remain weaker than what we normally see this time of year. Capital spending plans, as well, remain slightly below past norms. On the other hand, new orders and accounts receivables conditions are trending well and the 12 per cent of owners who say their business are in bad shape is the lowest proportion we have seen in more than a year.
Read the Business Barometer®.
To arrange an interview with Ted Mallett, please contact Kiara Morrissey at 416-222-8022, 647-464-2814 or [email protected].
CFIB is Canada’s largest association of small and medium-sized businesses with 109,000 members across every sector and region.