Small business owners’ confidence is at an all-time low as the impact of the COVID-19 pandemic continues to reverberate through the economy.
The Canadian Federation of Independent Business on Wednesday issued the results of its latest business barometer, which plummeted to 30.8 (out of a possible 100) from a level of 60.5 in February.
The report says one in five owners say their business is in a good state, compared with 38 per cent who say it’s doing poorly.
“It’s all related to keeping the wheels on the business,” said Ted Mallett, vice-president and chief economist for CFIB. “They’ve still got to be able to pay the bills to employees and landlords or mortgage holders, but now their incomes have been severely interrupted.”
Half of business owners say they are planning layoffs in the next three months, while just five per cent say they plan to add full-time staff.
Mallett said the nearest comparable period is the financial crisis in 2008 when the barometer dropped 20 points between September and December of that year.
The drop is even more pronounced today: the barometer has fallen 20 points in the past two weeks.
The CFIB report comes as non-essential businesses have been shut down by the province in Ontario and Quebec, and voluntarily in other jurisdictions, in an effort to slow the spread of the novel coronavirus. The moves have resulted in the layoff of workers across the country as businesses stop work.
Mallett says that even essential businesses such as gas stations are affected as consumers tighten their belts or their services are needed less frequently.
“They still may have almost as much of a labour bill and they still have to pay as much on things like heat and hydro and their lease payments for the property,” he said. “So they’re feeling it too.”
The barometer is based on 1,378 responses, collected from a stratified random sample of CFIB members, to an online survey on March 17 and 18.
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