Alberta businesses still on wobbly legs
Only 11 per cent of Alberta business owners say their business is in good shape
By ATB Economics 4 August 2020 1 min read
While Alberta’s small business owners are feeling better about the future than they were back in March and April, their operations remain rattled by the pandemic.
Based on a survey of its members, the Canadian Federation of Independent Business (CFIB) produces an index of small business confidence called the Business Barometer. As of July, the barometer reading for Alberta was 58.1 compared to a low of 26.2 in the second half of March.
Nationally, the barometer reading for July was 61.3, up from 54.6 in June and a low of 30.8 in the second part of March.
The higher readings are good news, but they don’t mean that things are back to normal.
With businesses that have failed since spring no longer around to take part in the survey, the CFIB cautions that “survivor bias” may be pushing the readings higher. The CFIB also notes that business owners may have “lower expectations of what good performance means 12 months out” than before the pandemic.
Alarmingly, “only 11 per cent of Alberta business owners say their business is in a good state, compared to 48 per cent who say their business is in bad shape.”
In addition, a third of Alberta business owners foresee having to cut staff over the next three months compared to just 9 per cent with plans to hire.
Overall, while confidence regarding where things will be in a year has improved as the economy has reopened, the business sector remains weak from the impact of the pandemic. This points to a slow recovery. It also raises concerns about the ability of some businesses to weather a second wave of the virus.