The level of confidence among Canadian small and medium-sized business owners fell significantly in early January 2022, to a level similar to spring 2020, according to the Canadian Federation of Independent Business (CFIB) Business Barometer.
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The results released on Tuesday show that the three-month confidence index lost more than 10 points (34.5), while the 12-month index fell to 52.4. “These are the lowest results since April 2020,” CFIB noted.
“The last time we saw such a low confidence index was in the spring of 2020. Hiring plans are again negative and SME managers who believe that their company is currently in difficulty outnumber them. those who consider it healthy. This clearly shows that many companies are in a precarious situation,” said Simon Gaudreault, vice-president of national research at the CFIB.
In fact, the study reveals that currently, 24% of small business owners plan to reduce their full-time workforce over the next three months, while only 16% plan to hire staff. They are 31% to have said that their business is not doing well, while 29% said they were happy with their results.
“It was quite the opposite in December since only 19% of entrepreneurs regretted their results, against 39% who were satisfied with them”, can we also read.
“The current situation takes us back to the first months of the pandemic. At the time, the heads of SMEs did not know when they could reopen and faced difficult choices, such as considering layoffs and even closing their doors permanently in order to minimize their losses, ”recalled Andreea Bourgeois for her part. , Director of Economics at CFIB.
The CFIB considers this data to be “very disturbing” and that a critical threshold has been reached for these companies which are “at the end of their rope and have accumulated enormous debts”. She calls on provincial governments to quickly lift restrictions related to COVID-19 and provide additional assistance to SMEs.
The survey was conducted with 503 CFIB members on January 6 and 7, 2022.