October 29, 2020 – Small business sentiment took a tumble in October amid new concerns about a second wave of COVID-19, falling 5.9 index points to 53.3 on the Canadian Federation of Independent Business (CFIB)’s Business Barometer®.
“The jump in COVID-19 cases is cause for anxiety in the small business sector, especially as some regions have renewed restrictions on businesses in the hospitality and personal services sectors, but the decline in optimism is pretty broad based,” said Ted Mallett, CFIB’s chief economist.
Businesses were operating at a little under 71 per cent capacity for the month, with no improvements since August. Staffing intentions saw a slight decrease, with 28 per cent of businesses planning to reduce full-time staff in the next three months and 12 per cent planning to hire. In total, 31 per cent of owners say their business is in good shape and 27 per cent say it is doing poorly.
An index level nearer to 65 normally indicates that the economy is growing at its potential.
Provincial results: Optimism dropped in seven out of 10 provinces
All but three provinces saw a drop in optimism this month. Quebec (42.2), Prince Edward Island (44.0) and Newfoundland and Labrador (49.2) were the most downcast. Business owners in Nova Scotia (63.1) and British Columbia (60.3) posted the highest results. Saskatchewan (57.9) Ontario (57.3), New Brunswick (56.1), Manitoba (56.1) and Alberta (52.0) posted results close to the national average.
Industry results: All sectors grouped within a few points of the national average
Most sectors posted results closely aligned with the national average. The arts and recreation (60.7) and health (60.5) sectors had the highest outlook, while hospitality (52.1) and transportation (53.0) were the least optimistic this month.
Read the October Business Barometer®
October 2020 findings are based on 1,151 responses, collected from a stratified random sample of CFIB members, to a controlled-access web survey. Data reflect responses received from October 5 to 19. Findings are statistically accurate to +/- 2.9 per cent 19 times in 20.
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Milena Stanoeva, CFIB
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. 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.