Post-Pandemic Business Confidence Continues to Decline: Chamber Report

(TORONTO– February 7, 2024) – High inflation, interest rates and housing costs continue to drive pessimism in Ontario’s economic outlook, according to the Ontario Chamber of Commerce’s (OCC) eighth annual Ontario Economic Report (OER). Despite this, many businesses surveyed remain confident in their own outlooks, with 53 percent expecting to grow.

“Business confidence in the economy has plunged from 29 percent at the height of the pandemic to just 13 percent two years later – driven by the rising costs of living and of doing business,” said Daniel Tisch, President and CEO of the OCC. “There are bright spots – particularly in growth sectors such as mining – thanks to strategic investments, population growth and improved labour market resilience. In 2024 and beyond, productivity must be our priority.”

The OER contains regional and sector-specific data on business confidence and growth, public policy priorities, regional forecasts, and timely business issues such as supply chains, employee well-being, diversity, equity and inclusion, economic reconciliation, and climate change.

“The business community’s policy priorities reflect ongoing pain points, with many highlighting the need for tax reforms, buy local programs, workforce development, and affordable housing,” said Claudia Dessanti, Senior Manager of Policy of the OCC. “Governments will need to balance fiscal prudence with investments focused on growing Ontario’s productive capacity to support business and consumer confidence.”

Outlook highlights:

• Small businesses are less confident (12 percent) than larger businesses (22 percent) due to challenges with repaying debt, fluctuations in consumer spending, inflationary pressures, and workforce-related challenges such as mental health.
• Simplifying business taxes is identified as a major policy priority of 50 percent of surveyed businesses.
• Confidence in Ontario’s economic outlook varies considerably across industries and is lowest within the agriculture sector (3 percent), non-profit (8 percent), health care and social assistance (8 percent), and retail (10 percent) sectors.
• Confidence is highest in the province’s mining (46 percent) and utilities (27 percent) industries, both of which benefited from strong growth and investments in the province’s electrification infrastructure and electric vehicle supply chains.
• Businesses in Northeast and Northwest Ontario exhibit the highest confidence at 23 percent, where the mining industry is a major employer.

This year’s report was made possible by the OCC’s lead partner, Hydro One, presenting partner, Bruce Power, and research partners, Golfdale Consulting and BMO. Read the report.

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Quotes

“This report is a great example of how the Ontario Chamber of Commerce continues to advocate for the businesses that drive economic stability and growth in the province. Hydro One is optimistic about the future. We are making important infrastructure investments that will unlock Ontario’s economic potential, power new industry and business, support job creation, and ensure we have a more resilient and reliable electricity grid.”

– David Lebeter, President and CEO, Hydro One

“Along with the OCC’s tireless advocacy in support of our business community, Ontario’s clean electricity system is helping to attract investment and support Ontario’s growth now and in the years ahead. Along with this expected growth, many sectors are investing in electrifying parts of the economy that currently rely on carbon-emitting sources, such as transportation and heavy industry. By refurbishing our nuclear fleet, Bruce Power is ensuring people and businesses in Ontario will continue to have access to reliable, clean, zero-carbon electricity to help meet this growing demand while providing thousands of high-skilled jobs and producing cancer-fighting medical isotopes in support of global health.”

– Pat Dalzell, Executive Director, Corporate Affairs & Market Development, Bruce Power

About the Ontario Chamber of Commerce
The Ontario Chamber of Commerce (OCC) is the indispensable partner of business and Canada’s largest, most influential provincial chamber. It is an independent, non-profit advocacy and member services organization representing a diverse network of 60,000 members. The OCC’s mission is to convene, align and advance the interests of its members through principled policy work, value-added business services and broad engagement to drive competitiveness and economic growth in the province.

For more information, please contact:
Samir Janmohamed
Policy and Public Affairs Specialist
Ontario Chamber of Commerce
samirjanmohamed@occ.ca | Mobile: (647) 882-9878

Backgrounder

The eighth annual OER offers unique insights into business perspectives across Ontario. It is informed by data from our annual Business Confidence Survey (BCS) and economic forecasts for the year ahead. The BCS was conducted online by Golfdale Consulting from October 10 to November 21, 2023, attracting responses from 1,857 respondents across Ontario representing a broad cross-section of industries, regions, and types of organizations across the province.

The OER is designed to support evidence-based decision-making across the public, private, and not-for-profit sectors. The OCC looks forward to working with our partners to continue advancing policy solutions, informed by our policy councils and focused on the core priority areas outlined in the report, to support economic prosperity across the province.