Canadian Business Leaders Express Pessimism About the Economy
CPA Canada Survey Reveals Negative Outlook
Toronto, January 23, 2024
A recent survey conducted by Chartered Professional Accountants of Canada (CPA Canada) has revealed a significant level of pessimism among Canadian business leaders regarding the country’s economic prospects. The survey, titled “Q4 Business Monitor,” polled CPA Canada members holding senior leadership positions and found that half of the respondents expressed pessimism about the Canadian economy’s outlook over the next twelve months.
Key Findings:
– 50% of respondents are pessimistic about the Canadian economy’s prospects over the next twelve months.
– 16% of respondents are optimistic about the Canadian economy’s prospects over the next twelve months.
– 34% of respondents are neutral about the Canadian economy’s prospects over the next twelve months.
– 90% of respondents believe current interest rates negatively impact the Canadian economy.
– 71% of respondents believe current interest rates negatively impact their companies.
– 73% of respondents believe inflation is hurting their companies.
– 61% of respondents believe inflation will continue to have negative consequences for their companies for at least six months.
– 63% of respondents believe their companies will have increased revenue over the next year.
– 54% of respondents believe their companies’ profits will increase over the next year.
– 37% of respondents anticipate an increase in employee numbers over the next year.
– 47% of respondents indicate their companies have fewer employees than needed.
– 62% of respondents cite a shortage of skilled workers in the labor market as the reason for having fewer employees than needed.
Analysis:
The CPA Canada survey findings paint a gloomy picture of the Canadian economy’s perceived trajectory among business leaders. The overwhelming majority of respondents (90%) believe that current interest rates negatively impact the economy, while a significant proportion (71%) believe that these rates are detrimental to their companies. This sentiment aligns with the Bank of Canada’s recent interest rate hikes aimed at curbing inflation. However, these measures appear to have dampened business confidence and raised concerns about the economy’s health.
Additionally, concerns about inflation persist among business leaders, with 73% reporting that it is harming their companies. The lingering effects of inflation, coupled with high-interest rates, contribute to the pessimistic outlook. Despite these challenges, some respondents expressed optimism about their companies’ future. Sixty-three percent anticipated increased revenue over the next year, while 54% expected higher profits. However, the survey also revealed a shortage of skilled workers in the labor market, cited by 62% of respondents as the primary reason for having fewer employees than needed.
Methodology:
The CPA Canada Business Monitor survey is conducted quarterly and draws upon the insights of professional accountants holding leadership positions in privately and publicly held companies. The Q4 2023 study gathered responses from 250 individuals identified by CPA Canada as senior industry leaders. The survey was conducted online using the Alchemer platform, with a response rate of 6.4%. The margin of error associated with this type of study is ±6.2%, with a confidence level of 95%. The survey period ran from November 28 to December 14, 2023.
About Chartered Professional Accountants of Canada:
Chartered Professional Accountants of Canada (CPA Canada) is a prominent national accounting organization representing over 220,000 CPAs domestically and internationally. The organization collaborates with provincial and territorial regulatory bodies to support the accounting profession. Its mission encompasses promoting transparency in financial markets, preparing members for evolving business environments, contributing to standard setting and public policy, and fostering a stronger accounting profession worldwide.