Despite an array of challenges — including inflation, supply chain disruptions and labour shortages — Canadian businesses are generally optimistic about the next 12 months, Statistics Canada reports.
In its latest survey on business conditions, which was carried out in July and early August, the agency found that 69.4% of businesses said they are either “very optimistic” or “somewhat optimistic” about their prospects for the next 12 months.
This underlying optimism comes amid an array of challenges that businesses expect to persist.
“Over the next three months businesses continue to expect to face a variety of obstacles related to rising costs, hiring and retention, as well as those related to supply chains and rising inflation,” StatsCan reported.
High inflation was seen as the top obstacle that businesses expect to face over the next three months, it noted, followed by higher input costs (including labour, capital, energy and raw material).
Just over one-quarter of respondents expect to have difficulty acquiring supplies over the next three months, StatsCan said.
Despite these ongoing input pressures, fewer businesses expect to raise prices over the next three months: 34.0%, down from 39.0% in the previous survey.
Additionally, the survey found that 50.0% of businesses expect profits to remain relatively unchanged over the next three months, while 35.9% are anticipating a decline in profits, and 11.2% forecast an increase in earnings.
Most businesses (80.4%) expect their employment levels to remain stable in the next three months, the survey found, as many businesses have developed recruitment, retention and training plans to try and address ongoing labour shortages, StatsCan reported.
Over the next three years, most companies (72.9%) expect to generate growth, with 65.0% anticipating average growth ranging from 1% to 15% per year, the survey found.
For the businesses that don’t expect to grow in the next three years, StatsCan said 34.3% are “satisfied” with their current revenue levels, and 27.7% don’t believe that the economic environment will be able to support significant growth in that time.