At the outset of the pandemic, The Canadian Chamber of Commerce partnered with Statistics Canada in an effort to assess the impact of COVID-19 on businesses across Canada. Today, this massive quarterly survey undertaking continues, measuring the experiences of more than 15,000 Canadian businesses. Two full years later, the most recent iteration of the Canadian Survey on Business Conditions, with results released in June 2022, points to ongoing stresses and new pressures, with some bright spots.
According to Stephen Tapp, Canadian Chamber of Commerce Chief Economist:
“For many of us, life is finally starting to feel more “normal.” But sadly, the latest CSBC reveals that the recovery remains incomplete for one–third of businesses, representing over 361,000 companies. Small and minority–owned businesses as well as high–contact services are lagging behind. Debt that piled up during the pandemic is becoming a bigger constraint. The top operating concern is unrelenting cost pressures, which are being exacerbated by the recent energy price spike
Over the next quarter, a record 39% of firms expect to raise prices. Central banks are quite worried about inflation and are quickly raising interest rates to bring it back under control. Companies are dealing not only with this “cost crunch,” but also with difficulties recruiting and retaining labour, and supply chain pains.
It’s not all bad news, though. In this challenging environment, Canadian companies are cautiously optimistic about the near–term outlook, with sales expected to pick up in Q3. Businesses are looking to hire in a very tight labour market, so wage pressures likely will build. To address supply chain problems, which are now expected to persist well into 2023, companies are seeking new, more local suppliers and substituting inputs. This survey shows that businesses innovated their processes during the pandemic, and more organizational changes are planned for the year ahead. With the acceleration in online activity, retailers are investing in e–commerce, and businesses are enhancing their cyber security defences. Finally, high–tech, professional services, and finance are defining the new equilibrium of hybrid work.”
Just some of the findings of note:
- With 71% of businesses in a better or similar position relative to 2019, larger firms with 100+ employees have recovered fastest.
- Except for First Nations, Métis or Inuit majority–owned businesses, minority–owned businesses are recovering more slowly than the average Canadian business.
- Over half of businesses (52%) reported they either cannot take on more debt or do not know if they can — up from 47% last quarter.
- Two–thirds of businesses in accommodation and food services see labour force shortages as a significant short–term challenge; construction and manufacturing are also expecting major
To view the Canadian Chamber’s data analysis: https://chamber.ca/wp-content/uploads/2022/06/2022-Q2-CSBC-Insight_June_20_2022_EN_Final.pdf