‘Hits just keep coming’ for Manitoba small businesses, CFIB survey

‘Hits just keep coming’ for Manitoba small businesses, CFIB survey

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Manitoba small business confidence remained at a standstill from last month, with the Canadian Federation of Independent Business (CFIB)’s Business Barometer 12-month outlook index at 56.8 points. Although Manitoba is at the top of the optimism scale in comparison to other provinces, the index is still lower than the historical average of 60.5 points.

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Among the sectors, businesses in agriculture (32.4), hospitality (40.0), retail (40.5) and construction (45.8) registered low levels of optimism this month. An index level below 50 means there are more owners who are negative than positive about their own business’ outlook.

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November results show increased shares of Manitoba businesses are worried about wage (75%), fuel and energy (61%), and insurance (59%) costs. Labour shortages also continue to be a significant concern for Manitoba small businesses, with 49% indicating that a ‘shortage of skilled labour’ is the number one challenge their business is facing.

“Small businesses are feeling less than optimistic going into the holiday season. In addition to increased fuel, insurance and borrowing costs, a lack of consumer demand is also making it difficult for many owners to know for sure where their business is headed,” said Brianna Solberg, CFIB provincial affairs director. “This is evidenced by the fact that the ‘insufficient domestic demand’ indicator has been on the rise since May and 32% of Manitoba small businesses are now reporting it is limiting their sales or growth.”

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Several other indicators, such as ‘below normal unfilled orders’, also pointed to signs of slowed demand.

Canadian businesses’ average price plans for the next 12 months have been zigzagging since August, sitting at 3.1% in November. Small firms also expect to increase wages by an average of 2.6% over the next 12 months. After peaking in the spring of 2022, both indicators are now returning to their historical averages of 2.1% and 1.8%, respectively.

“With all things considered, small businesses, the lifeblood of our economy, are currently navigating uncertain waters with a great sense of unease,” said SeoRhin Yoo, Policy Analys for CFIB. “As we approach the next provincial budget, the hope among entrepreneurs is that there will be policies crafted to nurture a more business-friendly environment that provides stability and support for small businesses to thrive and contribute to provincial economic growth.”

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Unfortunately, the federal government’s 2023 Fall Economic Statement left small businesses in the cold providing no immediate measures to help them turn the corner as they prepare to enter another year.

“The federal government has been tone-deaf on the issues weighing on small businesses. With four planned tax hikes over the next five months (EI, CPP, carbon tax, liquor tax), and no relief for the looming Jan. 18 Canada Emergency Business Account repayment deadline, small business owners are increasingly worried about their futures,” said Dan Kelly, CFIB president. “Small firms need help, like pausing on tax hikes and more time to repay CEBA loans.”

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