Calgary, July 30, 2020 – Alberta small business confidence improved slightly in July, increasing 2.4 points to an index of 58.1 on the Canadian Federation of Independent Business (CFIB)’s Business Barometer®. An index level near to 65 indicates that the economy is growing at its potential.
“Even though Alberta is well into stage 2 of its economic relaunch plan, small business sentiment is only showing cautious improvement,” said Keyli Kosiorek, CFIB’s Alberta policy analyst. “The small uptick in optimism points to the fact small business recovery is going to be a long, tough road and our province’s job creators need our support now more than ever.”
On average, Alberta businesses are operating at only 53.2 per cent capacity, a 3.6 per cent improvement over June, but well under what is considered necessary to be reliably profitable.
Only 11 per cent of Alberta business owners say their business is in a good state, compared to 48 per cent who say their business is in bad shape. Hiring plans remain quite weak in Alberta with only 9 per cent of business owners planning to hire full-time staff in the next three months, while 32 per cent foresee cuts.
“While it appears small business owners are feeling more confident about where they’ll be in a year, the unique nature of this economic shock is complicating the way we look at traditional indicators,” said Ted Mallett, CFIB’s chief economist. “It’s likely that many business owners have much lower expectations of what good performance means 12 months out. Shorter-term outlooks are still very weak. Additionally, we might be seeing some survivor bias at play— a notable number of weaker businesses polled in the spring are no longer responding to the survey, suggesting many may have failed in June and July.”
Provincial results: Ontario and Nova Scotia businesses most upbeat
Ontario posted the highest optimism level at 66.0, followed by Nova Scotia (62.4), Saskatchewan (58.3) and Alberta (58.1). Quebec (39.6), Prince Edward Island (41.7) and New Brunswick (50.5) posted the lowest results. British Columbia (55.0), Manitoba (55.5) and Newfoundland and Labrador (56.1) were middle of the pack this month.
Industry results: Natural resources agriculture and arts and recreation post lowest results
The natural resources (40.9), agriculture (42.8), and arts and recreation (47.1) sectors were the least optimistic this month. Professional services (62.9), wholesale (62.6) and retail (62.0) came in at the higher end of the optimism scale.
Read the July Business Barometer®
July 2020 findings are based on 677 responses, collected from a stratified random sample of CFIB members, to a controlled-access web survey. Data reflect responses received from July 2 to 20. Findings are statistically accurate to +/- 3.8 per cent 19 times in 20.
For media enquiries about the Alberta results, please contact Keyli Kosiorek, CFIB’s Alberta policy analyst at [email protected] or 403-874-2618. For national results, please contact Ted Mallett, Chief Economist, [email protected] or 647-464-2814
The Canadian Federation of Independent Business (CFIB) is Canada’s largest association of small and medium-sized businesses with 110,000 members across every industry and region, including 10,000 in Alberta. 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.