Business Barometer: Small business optimism fairly steady in October

After a rough spring, small business optimism has trended into more positive territory so far this fall. CFIB's October Business Barometer® Index gained a half point to 65.0 from September's reading, but it generally remains in line with the average value from the past four months.

On a scale between 0 and 100, an index above 50 means owners expecting their business’performance to be stronger in the next year outnumber those expecting weaker performance. One normally sees an index level of between 65 and 70 when the economy is growing at its potential.

We are seeing pretty positive results from owners of professional services, manufacturing and natural resources businesses, but not exuberance. On the other hand, those in transportation, finance, real estate and retail are somewhat less optimistic than the average. The most upbeat business owners are in Newfoundland & Labrador and British Columbia - both provinces seeing big gains this month. Optimism levels in Alberta and Saskatchewan fell back slightly, but still remain above average.

Remaining indicators show a general level of stability. Full-time hiring plans are basically unchanged this month and typical for this time of year, with 18 per cent expecting to hire and 12 expecting to downsize in the next few months.

Forty-one per cent of owners report a generally good state of business, while orders and accounts receivables show gradual trending improvements. Pricing expectations have shown a slight increase lately, rising to 1.5 per cent annual growth, while wage expectations are trending just a little higher at 1.7 per cent.

This report, prepared by Ted Mallett, Vice-President & Chief Economist of Canadian Federation of Independent Business, is available at