Monthly Business Barometer®

July 2024 Results

Small business optimism in Canada

CFIB’s Business Barometer® long-term index, which is based on 12-month forward expectations for business performance, remained fairly stable in July at 55.4. The short-term optimism index, based on a 3-month outlook, dropped however four point to 47,0. Both readings are at similar levels as last July, moderate and far from historical averages.    

Provincial picture

Canada’s marginal drop in long-term confidence is driven mostly by Ontario’s decline of 3.8 points. However, most provinces have seen improvements. PEI, NL, Manitoba, Alberta, and British Columbia are leading in optimism, and all are above Canada’s reading. The top four provinces are in fact at or shy above their respective historical averages.      

Sectoral picture

Almost all sectors recorded improvements in long term optimism.  The most notable gains were seen in transportation (+10.2), information, arts and recreation (+8.3) and agriculture (+7.7).  Construction (54.6), hospitality (54.1) and agriculture (50.8) are the least optimistic about their long-term outlook; however, their outlooks are just above the 50 mark.    
 

Inflation indicators

The average price increase indicator increased by 0.1 at 2.6. The average wage increase plans for the next 12 months dropped slightly again to 2.5, similar to the March reading.     
    

Other indicators

Staffing plans, both full and part-time, are below their seasonal levels, mostly due to a lack of appetite for hiring.  Consequently, labour shortages eased off. About 53% of SMEs reported domestic/foreign demand as the main limitation on sales or production growth. Capital equipment and technology costs have registered a small increase, and it stands at the highest level recorded for this indicator (34%). 
  
 

Methodology

These results are based on 467 responses received from July 3 to 15 from a stratified random sample of CFIB members to a controlled-access web survey. Findings are statistically accurate to +/- 4.5 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. Provincial and sectoral results, except Ontario and retail, are based on 3-months moving averages. Therefore the provincial and sectoral charts may not show the same movements as the aggregate Canada data. 

The next Business Barometer will be released on August 29, 2024.

For regional information about business optimism, price plans, limitations and main cost constraints for SMEs, please visit: the Business Barometer, Retrospective. 

Andreea Bourgeois, Director of Economics

Simon Gaudreault, Vice-President, Research and Chief Economist