The Canadian Federation of Independent Business (CFIB) has reported an alarming decline in small business confidence, with its business barometer long-term index falling to an all-time low in March. Conducted from March 5 to 7, the CFIB survey gathered 1,065 responses from a stratified random sample of its members. The index plummeted by 24.8 points, reaching a score of 25.0, indicating that more business owners expect weaker performance than those predicting stronger outcomes.
The CFIB's business barometer long-term index, which gauges business performance expectations on a scale from zero to 100, reflects a concerning outlook for the nation's small businesses. A reading below 50 suggests that pessimism outweighs optimism among business owners. The March figure of 25.0 highlights particularly dire expectations, as businesses navigate the uncertainties of an ongoing tariff war with the United States.
Simon Gaudreault, CFIB’s chief economist and vice-president of research, voiced his concerns about the impact of the tariff war on business sentiment. The uncertainty stemming from trade tensions is causing businesses to brace for potentially tougher times ahead. The apprehension is mirrored in hiring trends, with only 11 per cent of firms planning to expand their workforce. Meanwhile, a worrying 19 per cent of small firms are preparing for layoffs in the coming months, an increase from 13 per cent in February.
The decline in optimism is directly influencing small business hiring strategies. The reluctance to expand the workforce underscores the cautious stance businesses are adopting as they navigate the uncertain economic landscape. The CFIB’s findings suggest that small businesses are not only grappling with current challenges but are also concerned about future economic conditions.
