Small business confidence grew sharply in July, according to the latest monthly survey conducted by the Canadian Federation of Independent Business.
The CFIB’s index rose almost five points to 64.2, making up nearly all the ground lost in the previous four months.
Measured on a scale of 0 and 100, an index above 50 means owners expecting their businesses’ performance to be stronger in the next year outnumber those expecting weaker performance.
Small businesses in Saskatchewan were the most optimistic in Canada, with an index of 71.2, with post-flood Alberta not far behind at 66.8.
Newfoundland and Labrador also scored high at 66.7, followed by Ontario at 66.5 and British Columbia at 64.9.
New Brunswick (58.9), Manitoba (58.0), Nova Scotia (57.0), Quebec (56.4) and last-place Prince Edward Island (49.2) all registered below the national average.
“Canada’s small and mid-size business owners are considerably more optimistic than they were just a month ago, and the current index reading is the best since February,” said CFIB vice-president and chief economist Ted Mallett.
“Most of this turnaround is the result of much better numbers out of Ontario. Interestingly, the recent floods did not have a significant net impact on Alberta’s numbers, which would suggest the province is already getting back on track.”
Mallett added that business confidence appears to be improving in most sectors, particularly construction and manufacturing, with retail the only sector notably on the downside.
“A number of factors, including changes in pricing and hiring plans, new orders, capital spending, customer demand, and labour availability suggest an improvement in business performance,” he said.
The findings are based on 1,135 responses, collected from CFIB members, to a controlled-access web survey from July 1 to 17. Results are considered statistically accurate to plus or minus 2.9 per cent 19 times in 20.