Small business optimism in Canada
CFIB’s Business Barometer® long-term index, which is based on 12-month forward expectations for business performance, gained one point to reach 47.0. The short-term optimism index, based on a 3-month outlook, also increased by two points, and reached 39.8. Both levels are extremely low.
Provincial picture
Alberta and Newfoundland & Labrador are the only provinces to see increases in long term optimism. Nova Scotia is the only province to see a significant reduction in confidence over the next 12 months. All other provinces registered minimal changes in optimism. Manitoba, Saskatchewan, PEI, and NL are at or above 50 , while others are ranging from 42.1 in Quebec to 49.5 in Alberta.
Sectoral picture
Only three sectors registered some gains in long term optimism: wholesale (+5.5 points), construction (4.5 points) and agriculture (2.1 points). All others settled at even lower levels than in the previous months. The biggest drops in optimism were seen in arts and recreation (-5.9 points) and health and education (3.6 points). Similar to the last three months, agriculture, retail, and hospitality are at the bottom of the optimism scale.
Inflation indicators
Average price increase plans for the next 12 months remained unchanged at 3.1%. This marks the 3rd consecutive month of being stable but not dropping below the upper band of Bank of Canada’s range for inflation of 1% to 3%.
Average wage plans dropped slightly to 2.5%.
This is an excerpt from the CFIB’s December Monthly Business Barometer.