News
Small biz confidence holds steady in December

Jan. 3, 2013, Toronto — Optimism among Canada’s small- and medium-size businesses held steady in December, according to the Canadian Federation of Independent Business (CFIB).

The CFIB’s monthly Business Barometer index came in at 62.6 in December 2012, just slightly off the previous reading of 62.9.

“After a few months of swings, small business confidence ends the year very close to what it was in November,” said Ted Mallett, CFIB’s chief economist and vice-president. “While optimism is better than it was during the summer, the December reading is lower than index levels that were registered in the preceding winter, spring and fall months.”

Small business owners in Newfoundland and Labrador (69.1) remain the most optimistic in the country. Entrepreneurs in Saskatchewan (66.5), Alberta (65.7) and British Columbia (65.0) are above the national average, while Ontario (62.9) and Manitoba (62.3) are roughly equivalent.

Nova Scotia (61.8), Quebec (59.8), New Brunswick (59.1) and Prince Edward Island (54.3) are all below the national average.

“The economy continues to grow, albeit modestly,” added Mallett. “Entrepreneurs are reporting generally positive news about employment and capital investment plans. That suggests growth could improve once we see more economic optimism in the U.S. and Europe.” 

Full-time hiring plans continue to be strong for this time of the year. The percentage of businesses expecting to hire full-time staff in the next three or four months remains above 20 per cent, compared to 10 per cent who say they will cut back. Overall, 41 per cent of business owners described their state of business to be in “good” shape, about three-times the 14 per cent who said their state of business is “bad.”

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 December 2012 findings are based on 889 responses, collected from a stratified random sample of CFIB members to a controlled-access web survey. Findings are statistically accurate to +/- 3.3 per cent, 19 times in 20.