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Canada: Job Creation Compromised By SME’s Confidence?

ByThe National Bank of Canada
Published 08/05/2012, 04:30 AM
Updated 05/14/2017, 06:45 AM

Just released data from the Canadian Federation of Independent Businesses indicates that small and medium businesses confidence is being particularly hit in the current economic context filled with uncertainty. Indeed, the index fell for a fourth consecutive month in July at 60.1 (S.A.), reaching its lowest since July 2009 when the recession was still raging. Previously, such lack of optimism was observed only in October 2001, when the economy narrowly avoided a recession. Given that almost two thirds of private jobs in Canada have 500 employees of less (our definition of SME’s), this development does not bode well for job creation in the months ahead. As today’s Hot chart shows, a level of confidence of 60 suggest a stagnation of the labor market based on the historical relationship between those two variables. After a job creation of 73K in Q2, the Canadian job market should consequently progress at a snail’s pace in the next quarter.
Job creation compromised by SME’s confidence

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