Small Business Optimism in B.C. Slips
Prince George, B.C.- British Columbia is now third when it comes to optimism among small business in the country.
According to the latest monthly Business Barometer survey results from the Canadian Federation of Independent Business (CFIB), BC’s small business optimism decreased 2.3 points in September to 63.3.
That was enough to drop B.C. in the provincial rankings to third, behind Quebec (67.1) and Prince Edward Island (63.9)
While BC is still in the top three, confidence is now back to where it was at the start of the year and significantly below the levels seen in 2014 and the first half of 2015, when the index hovered around 70.
Measured on a scale between 0 and 100, an index level above 50 means owners expecting their business’ performance to be stronger in the next year outnumber those expecting weaker performance. An index level of between 65 and 75 means the economy is growing at its potential.
“British Columbia has seen a few months of softening business optimism,” said Aaron Aerts, BC economist. “It is now just outside the range of healthy economic growth. That being said, it remains at a reasonably high level and is the third highest in the country.”
According to the CFIB small business in BC still intend to ramp up hiring, but intentions were down in September. In September, 22 per cent plan to increase full-time staff in the next three months, down four points from August. In comparison, 14 per cent are looking to cut back, up three points from August.
Forty-three per cent of entrepreneurs in September believe the general state of health of their business is good, down four points since August. That compares to just 9 per cent of BC small businesses who describe their business’ health as poor, unchanged from last month.
Tax and regulatory costs are the main cost constraint on businesses as indicated by over half of respondents. Wage costs continue to become a more significant constraint, with almost half of entrepreneurs citing them as difficult to manage.