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July 30, 2020 – Small business outlook for the next 12 months is on the mend, but other measures of business health remain far below historic norms, according to the Canadian Federation of Independent Business (CFIB)’s Business Barometer®. The index of small business optimism reached 61.3 points in July.
“While it appears small business owners are feeling more confident about where they’ll be in a year, the unique nature of this economic shock is complicating the way we look at traditional indicators,” said Ted Mallett, CFIB’s chief economist. “It’s likely that many business owners have much lower expectations of what good performance means 12 months out. Shorter-term outlooks are still very weak. Additionally, we might be seeing some survivor bias at play— a notable number of weaker businesses polled in the spring are no longer responding to the survey, suggesting many may have failed in June and July.”
In total, 37 per cent of business owners said their business was in bad shape while 22 per cent said it was in good shape, a small improvement over June’s numbers. Hiring plans remained stagnant, with 14 per cent of business owners expecting to add full-time staff in the next three months and 30 per cent planning to cut back. Businesses’ shorter range 3-month outlooks are still on the same level as the 2008-09 recession.
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