Report finds business confidence at an all-time low in Ontario
A new report published by the Ontario Chamber of Commerce (OCC) suggests that business confidence across the province is at an all-time low.
The OCC published the seventh annual edition of its Ontario Economic Report (OER) on February 7. It finds that issues like labour shortages, inflation, health care system vulnerabilities, and forecasts of an economic contraction are dampening confidence in the province’s economic outlook.
“Only 16 percent of organizations surveyed have confidence in the economy,” said OCC President and CEO Rocco Rossi. “This is down from 29 percent last year. Promisingly, most businesses feel confident they can withstand these headwinds and continue to grow in the year ahead.”
The 2023 OER contains regional and sector-specific data on business confidence, public policy priorities, regional forecasts, and current business issues such as employee health and well-being, climate change, succession planning, diversity and inclusion, reconciliation, and remote work.
For example, it finds that confidence is higher on average in metropolitan areas, namely Toronto and Ottawa. Businesses in the larger cities benefit marginally from more convenient access to talent, services and markets than rural communities (i.e., through better broadband connectivity, integration with transportation networks, proximity to capital, and other conveniences).
“This year’s OER makes it clear that leaders in the public and private sectors must invest strategically in productivity, resilience, and long-term growth,” said Claudia Dessanti, Senior Manager, Policy, OCC. “Unsurprisingly, labour shortages continue to dominate as a source of concern directly impacting most employers and 87 percent of large businesses. Shortages are especially acute in specific sectors such as education, construction, and accommodation and food services.”
Other key highlights of the report include:
- Inflation and labour shortages are primary concerns for organizations.
- Despite low confidence in the economy, 53 percent of businesses are optimistic about the outlook and growth prospects of their own organizations, as high employment rates and population growth should prevent a sharp decline in consumer spending.
- Small businesses want governments to prioritize policies and programs that support their immediate financial and operational challenges, while large businesses are more interested in broader workforce development and health care issues.
- Businesses appreciate the importance of employee health and well-being, diversity and inclusion, economic reconciliation, and climate action – but there are notable gaps in addressing them.
The OER is informed by data from the OCC’s annual Business Confidence Survey and economic forecasts for the year ahead. The survey was conducted online between October 18 and November 30, attracting responses from 1,912 organizations across Ontario.