Small busi­ness op­ti­mism in N.L. low­est in coun­try

The Labradorian - - EDITORIAL -

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.

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