'Just two months into the year small business owners are already grappling with the realities of an electricity hike, a minimum wage increase, and a brand new statutory holiday,' says Jennifer English, senior policy analyst in Nova Scotia for the Canadian Federation of Independent Business.
© Metro/Clark Jang
[HALIFAX, NS] - According to the Canadian Federation of Independent Business, Nova Scotia’s Business Barometer index came in at a subdued 57.6 in February, a small -0.5 decrease from January’s reading.
Measured on a scale between 0 and 100, an index level above 50 means owners expecting their business’ performance to be stronger in the next year outnumber those expecting weaker performance. An index level of between 65 and 70 means the economy is growing at its potential.
Seventeen per cent of owners say the state of their business is ‘bad’ versus only 37 per cent who say it is ‘good,’ still one of the more negative results seen lately. Hiring plans also continue to be muted, with 14 per cent expecting to cut full-time staff in the next few months, compared to 10 per cent who expect to add on.
“This month’s Business Barometer Index puts Nova Scotia just one step above dead last in terms of small business confidence” said Jennifer English, CFIB’s senior policy analyst in Nova Scotia. “Just two months into the year small business owners are already grappling with the realities of an electricity hike, a minimum wage increase, and a brand new statutory holiday, and it’s having a downward impact on the mood in the province.”
Nationally, the Business Barometer index rose by 0.4 points to 64.4 this month, expanding on its 1.7 point gain in January. In fact, the index now runs about half a point better than its 2013 average.
“This is a sign that small businesses see the glass as more than half full for February,” said Ted Mallett, CFIB’s vice-president and chief economist. “And, the reading’s in line with last month’s trend, where we already saw optimism levels rebounding.”
Notably, the rapid downshift in the value of the Canadian dollar in late January has shown up in business pricing plans. After averaging 1.4 per cent through 2013, expected annual price increases surged to 2.1 per cent in February as importers scrambled to adjust to the new currency level.
From a national perspective, optimism levels are slightly scattered from coast to coast. Business owners in British Columbia (71.4), Alberta (70.6) and Newfoundland and Labrador (67.2) are the most optimistic, seeing little change from January. Quebec (59.6) and Prince Edward Island (61.0) saw slight improvements but still remain below the national average. And, while Ontario (62.9) experienced a surge in optimism in January, its February index score fell this month, as did Manitoba’s (58.7). Optimism among small business owners in Saskatchewan (63.6), Nova Scotia (57.6) and New Brunswick (56.6) stayed virtually the same.
February 2014 findings are based on 1156 responses, collected from a stratified random sample of CFIB members, to a controlled-access web survey. Findings are statistically accurate to +/- 2.9 per cent 19 times in 20.