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Small biz confidence drops in June


June 26, 2014
By Canadian Garden Centre & Nursery

June 26, 2014, Toronto — Small business optimism took a significant downturn this month, according to the Canadian Federation of Independent Business' Business Barometer Index.

The index, measured on a scale of zero to 100, fell from 67.1 last month, to a reading of 63.5 in June. An index level above 50 means owners expecting their business' performance to be stronger in the next year outnumber those expecting weaker economic performance. According to past results, index levels normally range between 65 and 70 when the economy is growing at its potential.

"Reduced optimism among business owners in Ontario, Manitoba and Saskatchewan has driven down the national numbers," said Ted Mallett, CFIB's chief economist and vice-president. "But we're also seeing other provincial indicators on pattern, suggesting that this month's drop is not the start of any kind of sustained trend."

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Index readings in Ontario, Manitoba and Saskatchewan dropped to 61.9, 64.0 and 65.8 respectively, but optimism remained high in British Columbia (73.2), Alberta (72.6) and Newfoundland and Labrador (70.0).

Quebec (62.0), Prince Edward Island (61.0) and New Brunswick (60.7) all gained some ground from last month, while Nova Scotia’s barometer reading fell by just under two points to 55.8.

“While the hospitality and construction sectors have seen the biggest dip in optimism across the board, there are still reasons to stay positive,” said Mallett. “New order indicators are strong, while 39 per cent of owners say their businesses are in good shape – and this trend continues to climb upward.”

Short-term hiring plans also remain reasonably good for this time of year and pricing and wage growth plans are pinned near the two per cent mark.

Findings are based on 1,042 responses, collected from a stratified random sample of CFIB members, to a controlled-access web survey. Data reflect responses received through June 16. Findings are statistically accurate to +/- 3.0 per cent 19 times in 20.


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