Business confidence falls slightly in June
TORONTO -- Optimism among Canada's small- and medium-sized business owners fell slightly in June. According to the latest business confidence survey findings from the Canadian Federation of Independent Business (CFIB), the business confidence index came in at 66.3, down about a point from May's 66.9 level and its 70.7 April peak.
"Although a negative result, the index and other general indicators of business performance from our monthly survey are in line with June 2010 levels," said Ted Mallett CFIB vice-president and chief economist. Adding, "Shorter-term perspectives on business performance and hiring three or four months ahead are also settling a bit. However, these changes are not unusual for this time of year."
Business owners in Alberta remain the most optimistic in Canada with an index value of 76.2, with those in British Columbia, Manitoba and Saskatchewan are a step behind, with index values ranging from 71.0 to 69.2. Newfoundland & Labrador businesses lead the way in Atlantic Canada with an index score of 72.4. However, business owners in the remaining provinces are well below the national average with index scores sitting between 57.1 (PEI) and 65.0 ( Ontario).
The most optimistic business owners are in financial services, wholesale trade and personal services. Those in business services and manufacturing are also slightly more positive than the norm, while the hospitality and agriculture sectors continue to be the least optimistic.
"While capital spending plans were slightly restrained last month, particularly for electronic equipment and production machinery, concerns about the cost of energy has fallen off from levels in previous months, which is good news," said Mallett. In June, 73 per cent of respondents cited energy as a major cost concern, down from 78 per cent in May.
Measured on a scale between 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 75 when the economy is growing. The June 2011 findings are based on 831 responses, collected from a stratified random sample of CFIB members, to a controlled-access web survey. Findings are statistically accurate to +/- 3.4 per cent 19 times in 20.