Canada's small businesses have seen an improvement in their long-term confidence of 3.5 index points in March 2023, in tandem with a small pitch forward in short-term optimism.
Provincial Outlook
Most provinces have seen gains in long- and short-term optimism levels. Over the long-term, British Columbia, Newfoundland and Labrador, and Nova Scotia have seen the most marked improvements (more than four points). PEI, Manitoba and Saskatchewan are leading with levels around 60; while Quebec and NB are at the bottom on the confidence scale, with levels shy of 50. Over the short-term, confidence is ranging from mid-40s to low-50s, except in NB where the level is significantly lower at 37.9. This fairly tight spread shows very timid confidence for the beginning of the summer.
General business indicators
Full-time staffing plans have seen the seasonal uptick in the share of businesses looking to hire (25%) similar to the same time in the previous year. Supply chain indicators remained constant in March. Similarly to the previous months, borrowing costs and product input costs remain the top cost constraints with current levels about twice the historical average value. Sales or production growth is limited by labour shortages and input product shortages, these factors read well above the historical levels.
Price and wage plans
Average future price increasing plans saw a softening to 3.5; at the same time average wage increase plans decreased to 3.1. The gap between these two indicators has significantly closed in March—the current gap is the smallest since the beginning of the pandemic, yet still higher than the pre-pandemic average gap.
This is an excerpt from the CFIB’s report.