CORY REDEKOP
LANGLEY -The Canadian Survey on Business Conditions tallies the responses from over 15,000 companies each quarter and reports on their key obstacles, expectations and outlook, and their views on emerging issues.
The new Q1 2024 Survey reveals businesses are stuck in a cautious holding pattern, facing weak consumer demand, increased interest rate costs, and continued challenges with general cost challenges. Operating a business will continue to be challenging in 2024, with affordability concerns exacerbated by upcoming mortgage renewals for many households. While we are moving in the right direction this quarter, a more significant rise in business optimism is likely still a few quarters away.
Business Outlook:
While business expectations and outlook improved slightly in the first quarter of 2024 compared to the last survey, they continue to be weak. In BC, the business outlook is second-lowest in the country and has lagged behind the national average for the last 3 quarters.
On a sectoral basis, those industries most exposed to consumer spending constraints have the worst outlook – including Transportation, Accommodation & Food Services and Real Estate. The most optimistic sectors include Finance & Insurance, Arts, Entertainment & Recreation, and Manufacturing.
Business Obstacles:
Labour challenges and supply chain issues continue to decline, while the top 6 obstacles business expect to face are all cost-related challenges, led by Inflation, Input Costs, and Interest Rates/Debt Costs.
For the second straight quarter, Consumer Demand has increased as a concern of business, particularly in BC for business in Retail Trade, Wholesale Trade, and Accommodation & Food Services.
Despite continued progress on inflation, the share of companies expecting to raise prices next quarter remains elevated. 25% of businesses expect to increase selling prices in the next 3 months. In BC, this is significantly higher than that national average.
Labour Market:
Canada’s labour market continues to normalize and head towards the pre-pandemic balance of supply and demand. That said, a majority of all businesses expect labour obstacles over the next three months (with the exception of 1-4 employee small businesses). Labour shortages are most acute in the Accommodation and Food Services, Construction and Healthcare industries, and less of an issue for Professional Services, Finance/Insurance, and Real Estate. The tech sector (Inleads as the industry with the greatest challenges with retaining skilled employees.
‘Data For Business’ is an effort of the Langley Chamber, in partnership with the Canadian Chamber, to bring our members reports, stats and analysis on economic and business data to help inform business and investment decisions. Cory Redekop is the CEO of the Langley Chamber of Commerce.
