The confidence of small business owners continued to decline in April, following a bigger hit in March, according to the Canadian Federation of Independent Business (CFIB). The Business Barometer index fell half a point from March’s results to 62.4.
“After a promising January and February, more business owners appear to be disappointed with their firms’ performance so far this spring,” said Ted Mallett, CFIB’s chief economist and vice-president. “These latest results are back in line with what we saw in the last months of 2012 when the economy was exhibiting only lacklustre growth.”
Small business owners in Newfoundland and Labrador (69.1) are the most optimistic in the country, although confidence is rising in British Columbia (67.6), which overtook Saskatchewan (67.2) and Alberta (65.3). Quebec (64.1) and Ontario (63.2) are just above the national average, while Manitoba (61.7) and New Brunswick (58.1) are below. Nova Scotia (53.8) saw Canada’s biggest decline in business confidence, meaning Prince Edward Island (55.1) is no longer the lowest in the country.
“The pattern across the country has been quite uneven,” added Mallett. “If we look at the results by industry, the biggest declines in optimism occurred in manufacturing and retail, while the confidence of construction, wholesale and business services firm owners has remained steady.”
Reports on new orders and accounts receivables are down in recent months, although so are shortages of skilled labour, now reported by 29 per cent of respondents, which is down from the mid-30s range in late 2012.
Measured on a scale of 0 and 100, an index level above 50 means owners expecting their businesses’ performance to be stronger in the next year outnumber those expecting weaker performance. According to past results, index levels normally range between 65 and 70 when the economy is growing at its potential. The April 2013 findings are based on 1184 responses, collected from a stratified random sample of CFIB members, to a controlled-access web survey. Findings are statistically accurate to +/- 2.8 per cent 19 times in 20.