Toronto, December 18, 2025 – Canada’s small business optimism continued to rebound in December, according to the latest Canadian Federation of Independent Business (CFIB) Business Barometer®. Long-term confidence rose to 59.9, up 4.2 points from November and just below the index’s historical average.
“December’s numbers are encouraging, but they don’t tell the full story,” said Simon Gaudreault, CFIB chief economist and vice-president of research. “While confidence is getting back to its historical average, more than half of businesses are continuing to report insufficient demand as the top growth constraint. That’s a clear signal that the economy is still fragile heading into 2026.”
Provincial and sectoral trends
Confidence levels improved in British Columbia, Ontario and Alberta, all posting long-term readings at or above 60. However, Quebec saw a drop to 50 and now sits the lowest among all provinces. Short-term confidence remains subdued across the country, reflecting ongoing economic uncertainty.
Sector performance was mixed, with hospitality and construction seeing seasonal declines, while health and education, retail and the insurance sectors all gained momentum in December.
“Business owners have told us that 2025 has been a real rollercoaster. It’s been both challenging and unpredictable,” said Andreea Bourgeois, CFIB director of economics. “Even with some positive signs overall, concerns about demand, costs and staffing continue to weigh heavily as ongoing trade uncertainty makes it hard to plan ahead.”
Cost pressures and staffing challenges remain
Price increase and wage growth intentions remained relatively stable at 2.6% and 2.2% respectively. Staffing plans overall remain weak with more businesses planning to reduce full time positions (16%) than hire (14%).
Insufficient demand remains the top growth barrier (54%) and continues to sit well above historical norms. Tax and regulatory costs (62%), wage costs (60%), and insurance costs (58%) are the top cost constraints to end the year.
For media enquiries or interviews, please contact:
Dariya Baiguzhiyeva, CFIB
647-464-2814
public.affairs@cfib.ca
Methodology
December Business Barometer®: December findings are based on 355 responses from a stratified random sample of CFIB members, to a controlled-access web survey. Data reflects responses received from December 2-8. Findings are statistically accurate to +/-5.2 per cent, 19 times in 20. Every new month, the entire series of indicators is recalculated for the previous month to include all survey responses received in that previous month. Measured on a scale between 0 and 100, an index above 50 means owners expecting their business’s performance to be stronger over the next three or 12 months outnumber those expecting weaker performance.
About CFIB
The Canadian Federation of Independent Business (CFIB) is Canada’s largest association of small and medium-sized businesses with 100,000 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.
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