Following two months of slippage, confidence among Canada's small and mid-sized businesses rebounded in July, rising two points to 68.3 — about the same level it had been holding earlier in the year, according to the monthly Business Barometer from the Canadian Federation of Independent Business (CFIB).
"For the most part, it appears Canadian business owners are not seeing much turbulence from the sovereign debt uncertainties in Europe and the U.S," said Ted Mallett, vice-president and chief economist at CFIB. "Measures for new orders, inventories and overtime are up, compared to past months, and investment intentions have improved in all categories except vehicles."
The wide divergences in optimism across the country seen earlier this year appear to be coming back into balance. Although still leading, confidence is down slightly in the West. Alberta businesses are still the most optimistic, and Alberta is the only province with an index score over 70. In the central provinces, prospects appear to have brightened, found the survey of 931 CFIB members.
Prince Edward Island and Nova Scotia businesses are at the other end of the scale — in the low 60s.
The industry profile generally shows the same pattern of balance, with only the business services and transportation sectors showing performance above 70, with most of the rest remaining near the national average. That being said, business owners in the agriculture and hospitality sectors continue to have the least optimistic outlooks, found the survey.
Short-term employment plans are also quite positive — with 18 per cent of business owners saying they will add to full-time staff levels in the next three or four months, versus only 10 per cent who expect to cut back. The eight-point difference is the largest seen for this time of year, said CFIB.
Measured on a scale between 0 and 100, an index level above 50 means owners expecting their businesses' performance to be stronger in the next year outnumber those expecting weaker performance. According to past results, index levels normally range between 65 and 75 when the economy is growing.
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