Small business optimism in Canada
CFIB’s Business Barometer® long-term index, which is based on 12-month forward expectations for business performance, gained 0.4 point to 54.8. The short-term optimism index, based on a 3-month outlook, dropped to 47.9, 1.2 points lower than July.
Provincial picture
Most Western provinces have gained in optimism over the long term, with Saskatchewan seeing the biggest increase overall (+3.7), while BC was the lone province with a slight decrease (-0.6). Ontario recorded an increase (+2.2) and Quebec remained stable (-0.1). All Atlantic provinces besides Nova Scotia displayed a decline in long-term optimism. Only three provinces, Prince Edward Island (68.4), Nova Scotia (60.2) and Alberta (59.8), were in line with more normal optimism levels this month.
Inflation indicators
Both the average price and wage increase plans for the next 12 months declined in August, now sitting at 3.0% and 2.5%, respectively, sharply down from their mid-2022 peaks of 4.9% and 3.6%, and continued to close the gap with their historical averages of 2.1% and 1.8%. Compared to the middle of last year, the share of businesses that plan to raise wages and prices by 6% or more has been reduced by almost two thirds, and overall price and wage plan distributions are slowly trending towards their pre-pandemic shares.
This is an excerpt from the CFIB’s August Monthly Business Barometer.