Long-term small business confidence edged up to 50.0 in October, up from 48.5 in September, as high fuel costs and tariff uncertainty continue to haunt small firms, finds the latest Monthly Business Barometer by the Canadian Federation of Independent Business (CFIB).
Measured on a scale between 0 and 100, an index below 50 means owners expecting their business’s performance to be weaker over the next three or 12 months outnumber those expecting stronger performance.
Absorbing tariff and fuel costs increases
Average price increase plans dropped to 2.8% after spiking to 3.3% in September. CFIB’s recent edition of the Main Street Quarterly shows that small firms planning to absorb more than half of tariff and fuel cost increases outnumber those intending to pass most of those costs on to customers.
“Sectoral confidence—also calculated as three‑month moving averages— remains weakest in agriculture, construction, manufacturing, transportation, and retail trade; with readings below 50. Transportation, construction, retail and manufacturing also recorded the largest declines in long-term confidence,” said the report.
Higher share of employers planning to lay off staff
‘Full-time staffing plans weakened further in October, with a higher share of employers planning to lay off staff (22%) than to hire (11%). This month marks the weakest net staffing intentions since the pandemic.
“Insufficient demand remains the top constraint to business and production expansion, cited by 50% of SMEs, followed by the shortage of skilled labour (43%).
“Despite the additional pressures from higher fuel costs, about 70% of small businesses expect to pass on to customers only a very small part of these higher costs. On average, businesses expect to pass on only about one-fifth (21%) of the higher costs through price increases.”
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