Industry still less confident than other sectors, monthly report reveals
Farmers may have mixed feelings about the Canadian Federation of Independent Business’s (CFIB) August Business Barometer
The monthly report lists index values to identify the confidence levels of small businesses in 13 Canadian industries.
“One normally sees an index level of between 65 and 70 when the economy is growing at its potential,” the CFIB website
Agriculture appears to be the least-confident business sector in Canada, holding the lowest index value (41.1) in this month’s report. The natural resources sector is next in line with a value of 48.3.
However, the agricultural sector saw an increase of 0.8 points from July, making it one of seven industries to improve from the previous report.
Several factors limited the industry’s growth.
Survey participants identified such restricting factors as insufficient demand, and shortages of working capital and inputs. Twenty-five per cent of respondents said that foreign competition limited their recent growth, the report
Shortages of both skilled (31 per cent) and unskilled (29 per cent) labour limited sales or production growth more than other factors.
Several financial constraints also affected farmers’ operations, including expenses related to banking, inputs, capital equipment and technology, and insurance.
Costs related to fuel and energy (73 per cent), wages (55 per cent) and taxes and regulations (62 per cent) had the largest impact this period, the report shows.
However, as a whole, Canadian small businesses saw an overall improvement from the last report.
“After a major drop amid trade tensions in July, small business confidence rebounded to 61.6 this month, gaining 4.8 index points over last month’s … Business Barometer,” the release said.
When Canada holds a value above 50, the number of business owners expecting strong performance within the next year is greater than the amount of people expecting weaker performance, the CFIB website states.
Farms.com has reached out to the CFIB for comment.
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