Winnipeg, August 25, 2016 – Today, the Canadian Federation of Independent Business (CFIB) released its latest Business Barometer® index, which shows that small business optimism in Manitoba remained unchanged in August at an index of 56.1, down 0.3 points from 56.4 in July. This index level is still below the national index of 59.8.
“After a slight decline last month, small business optimism was relatively unchanged in August, but still remains well below the national index and the five year average for Manitoba,” said the new Director of Provincial Affairs for Manitoba, Jonathan Alward. “Short-term hiring plans are still in neutral with 15 per cent of business owners looking to hire full-time, while 13 per cent plan to reduce staff. Only 35 per cent of small business owners say their businesses are in good shape, compared to 40 percent nationally.”
Nationally, small business optimism took a bounce back upward in August. CFIB’s Business Barometer Index erased a weak July reading, rising more than two points to 59.8—almost the same as its June level and the second-highest monthly mark registered since May of 2015. Sentiment still has plenty of room to improve though, with the index running five points under its 2010-14 average.
“There were notable gains in five provinces and dips in the five others,” said Ted Mallett, CFIB chief economist. “The good news is that the declines in four of the five other provinces were very slight, about a point or less. The exception was Newfoundland & Labrador, which plunged by more than 10 points from July’s index. The overall picture remains one of guarded expectations, as this is the second-highest monthly index since May 2015, yet the index is still running five points shy of its 2010-2014 average.”
Improvements were widespread across the provinces—rising in five, including; Prince Edward Island (70.5), Quebec (64.9), Ontario (62.6), Nova Scotia (62.3) and Saskatchewan (54.9). Of the provinces that saw index declines, four of five were very slight—about a point or less in each case; British Columbia (65.6), New Brunswick (63.0), Manitoba (56.1) and Alberta (45.6). The steepest drop off in optimism was in Newfoundland and Labrador (37.8).
Results and the full report are available here.
Highlights of the Manitoba Business Barometer for August:
- 35% of small businesses in Manitoba say their overall state of business is good (40% nationally); 13% say it is bad (15% nationally).
- 15% of Manitoba small businesses plan to increase full-time employment in the next 3-4 months (19% nationally), and 13% plan to decrease employment (13% nationally).
- Insufficient domestic demand remains the main operating challenge (38%), followed by management skills/time constraints (34%), and shortage of skilled labour (31%).
- Major cost pressures for small business include: tax/regulatory costs (65%), wage costs (56%), and insurance costs (54%).
Measured on a scale of 0 and 100, an index level above 50 means owners expecting their businesses’ performance to be stronger in the next year outnumber those expecting weaker performance. According to past results, index levels normally range between 65 and 70 when the economy is growing at its potential. August 2016 findings are based on 603 responses, collected from a stratified random sample of CFIB members, to a controlled-access web survey. Data reflect responses received through August 14. Findings are statistically accurate to +/- 4.0 per cent 19 times in 20.
To arrange an interview with Ted Mallett, Vice-President & Chief Economist on the national results please call (416) 222-8022 or email [email protected]. You may also follow Ted on Twitter @cfibeconomics.
To arrange an interview with Jonathan Alward, Director of Provincial Affairs for Manitoba on the provincial results, please call 1 888-234-2232, 204-982-0817 or email [email protected]. You can also follow CFIB Manitoba on Twitter @cfibMB.
Business Barometer® is a monthly publication of the CFIB and is a registered trademark.