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2023 Q4 Business Conditions Survey
The Business Data Lab has released their report on the 2023 Q4 Business Conditions Survey which tracks both how businesses feel about their economic outlook as well as how they are performing in the general labour market. There continues to be some growing concern in the business community about profitability and hiring across all sizes of businesses. The cost of goods have become too high for some businesses to remain profitable and with no further extension to the CEBA deadline, many small businesses are being forced to close. It is important to note that the deadline for repayment to receive some forgiveness on CEBA loans has now passed as of January 18th, 2024. This means that any outstanding loans are required to be paid in full by December 31, 2026. According to the BDL Report, only 28% of businesses have fully repaid their loan. Of the remaining loans, 66% of businesses reported that they are likely to have the loans fully paid by the deadline in 2026. This leaves the remaining 34% of businesses with outstanding loans not expecting to repay those loans in full by 2026. These are concerning numbers at a time when businesses are already struggling with costs. When looking at the broader picture of the Canadian economy, GDP growth has stagnated with a quarterly change of 0.0% While Household disposable income has increased by 3% since the previous quarter according to Stats Canada. This translates to all sizes of business expecting to see sizable decreases in profitability in Q1 of 2024. The only expected increases that are reported are in medium to large businesses in both sales and employment. When looking at the overall outlook for individual businesses, only 66% of business owners said they were optimistic about the next year; the lowest percentage in the last two years. Businesses have reported that various other challenges that they had faced have eased in the last quarter. Businesses reporting challenges in labour have fallen to 26%, finance has fallen to 17% and supply chain issues have fallen to only 9%. Inflation has also dropped from a high of 8.1% to the current 3.1%. This remains above the target of 2% but is a promising change across the last several years.
To read the full report, please visit: https://bdl-lde.ca/wp-content/uploads/2023/12/2023_Q4_CSBC_EN_Report_Final.pdf
