Statistics Canada’s latest quarterly Canadian Survey on Business Conditions (CSBC) reveals that the economic recovery remains incomplete for one-third of businesses.
“Businesses are dealing not only with a ‘cost crunch’, but also with difficulties recruiting and retaining labour, and supply chain pains,” the Canadian Chamber of Commerce notes adding that it’s not all bad news.
“In this challenging environment, Canadian companies are cautiously optimistic about the near-term outlook, with sales expected to pick up in Q3. The survey shows that businesses innovated during the pandemic, and more organizational changes are planned for the year ahead,” the Chamber says.
Here are the top 10 things learned about Canadian businesses from Statistics Canada’s Q2 CSBC:
- More than 361,000 Canadian businesses (one-third) still have not recovered fully from the pandemic.
- Businesses’ ability to take on debt continues to decline, with smaller firms being most constrained along with businesses in high-contact services, construction, health and social sectors.
- Rising input costs remain the top business obstacle.
- Inflationary pressures on businesses are broadening, with the recent surge in energy prices adding fuel to the fire and a record-high share of firms expect to raise prices next quarter.
- The competition for talent is a major pain point, with around one-third of businesses expecting labour difficulties in the next quarter; high inflation is expected to add further upward wage pressure.
- As COVID concerns subside, flexible work arrangements might be stabilizing, with between 6% and 12% of the workforce exclusively working remotely for businesses located in Canada’s major cities.
- Many companies expect supply chain problems to persist well into 2023; businesses are partnering with new and/or local suppliers and substituting inputs to address these challenges.
- As sales have shifted online, retailers are looking to invest in e-commerce capabilities, while larger firms are enhancing cybersecurity.
- During the pandemic, larger businesses continued to innovate. Organizational changes are coming in the year ahead for arts, entertainment and recreation, information and culture, and manufacturing businesses.
- Canadian businesses are cautiously optimistic about short-term sales, hiring and investment, while increased costs are expected to squeeze profitability.
The Q2 CSBC 2022 was conducted in April and May 2022 with 16, 678 Canadian business respondents from across the country.