Canadian Business Is Upbeat

Despite ongoing concerns about inflation and interest rates, Canadian businesses are increasingly optimistic about their prospects in the months ahead, according to new research from Statistics Canada.

The latest survey of business conditions, that was carried out in April and early May, found that companies are weathering through an array of obstacles, including higher input costs and labour challenges, such as skills shortages, recruiting and retention issues.

That said, according to the latest survey:

• the leading challenge businesses expect to face is inflation, StatsCan said, with over half (54.4%) of all businesses concerned about inflation.

• Rising input costs — including labour, capital and raw materials — ranked second at 44.6%.

• Higher debt costs and the impact of interest rates remained a concern for 40.6% of respondents.

• Regarding labour-related challenges, 43.2% of businesses expected to face labour-related obstacles over the next three months.

• 72.1% of businesses were “very” or “somewhat” optimistic about the next 12 months.

• 20.7% of businesses expected their sales to rise in the next three months.

• Only 24.3% expected to raise their prices in the coming months.

Despite the list of common concerns, the overall outlook of survey respondents has brightened

This continues a trend of a gradual increase in optimism when compared with 68.4% of businesses in the first quarter and 65.9% of businesses in the fourth quarter of 2023.