Newfoundland and Labrador saw small business optimism drop to 48.3 — now the lowest mark in the country after being among the most optimistic provinces, according to the latest Business Barometer survey by the Canadian Federation of Independent Business (CFIB).
According to the CFIB, short-term hiring expectations in N.L. remain in negative territory, with 26 per cent of owners expecting to cut back while only seven per cent plan on hiring. Currently, 40 per cent of respondents see their firms in good shape, while 18 per cent see their firms in bad shape.
After four straight months of decline, overall small business optimism in the country improved slightly in October, the CFIB survey indicates.
For the country as a whole, the monthly index — based on a national survey which asks business owners how they expect their business to perform — inched up 0.3 points this month, to 57.2 (out of 100).
“Concerns about wage costs, taxes and regulations continue to be top of mind when business owners are asked about their costs and constraints of doing business,” CFIB chief economist Ted Mallett stated in a news release. “The end result remains a pretty sour picture across the country, with most provincial indexes clustered around the 55 mark.”
Prince Edward Island continued a confidence loss, dropping to 53.6 and falling below the national average for the first time since April, the CFIB said.
Nova Scotia and New Brunswick saw small drops to 62.5 and 56.3, respectively.
Quebec’s confidence cooled again, but its 67.6 confidence marker remains the best in the country, the CFIB said.
Ontario saw a sliver of improvement, gaining a half point to 55.5, while Manitoba saw a small drop to the same 55.5 score.
In the West, Saskatchewan’s optimism climbed to 52.7, Alberta’s index saw a slight downward move to 55.2 and British Columbia improved to 61.9.
By industry sector, the CFIB said there are a few bright spots: optimism improved in the agriculture, resources and retail sectors. For the rest — with the exception of professional services — optimism declined this month.
“Other businesses indicators are continuing to lag: in particular, full-time hiring plans have tilted negative and only half of business owners are expecting to make capital investment plans in the next few months — low by historical standards,” Mallett said.
The October findings are based on 727 responses, collected from a stratified random sample of CFIB members, to a controlled-access web survey. Data reflect responses received through Oct. 16. Findings are statistically accurate to plus or minus 3.6 per cent, 19 times in 20.
On a scale between 0 and 100, an index above 50 means owners expecting their business’s performance to be stronger in the next year outnumber those expecting weaker performance. The CFIB says usually there is an index level of between 65 and 70 when the economy is growing at its potential.