The small business confidence rating in BC continued its roller-coaster ride this month according to the Canadian Federation of Independent Business.
It sits at 53.1, down two points from August and is now tied with Saskatchewan for the second-lowest index in Canada.
The BC index is six points below the national average of 59.3.
“It’s certainly a red flag we are keeping our eye on closely. At the beginning of the year, the index was at 57.3 and we’ve seen it fall four points since then as it’s doing this wave-length rise and fall,” said Muriel Protzer, CFIB Policy Analyst.
She told Vista Radio increased costs including the Employers Health Tax (EHT) is making the uphill climb for small business owners in Prince George and Northern BC even tougher.
“It’s becoming increasingly expensive to hire and at the same time, entrepreneurs are also facing a shortage of qualified labour because they can’t find the right people to hire, they are also finding it difficult to keep good employees because the cost of those jobs is going up.”
“British Columbia, when you look across Canada, has the second-worst payroll cost in the country only coming second to Quebec, certainly small businesses across British Columbia are really struggling.”
As for what can be done to mitigate the problem, Protzer believes much of this headache will go away if the EHT is shored up by the province.
“First and foremost, it’s essential the government do its part in addressing that tax as there are some short-term solutions to help mitigate the damages that the tax is doing, such as increasing the exemption threshold for small businesses so they are not having to pay that tax making it fully graduated.”
“Wage costs are one of the most difficult things for small businesses to absorb, specifically we’re looking at payroll being the largest component and that’s a concern growing in the area of wage costs. In British Columbia for example, we had the Employer’s Health Tax that came into effect this year with most businesses paying that tax.”
Quebec has the most optimistic entrepreneurs in the country with a rating of 69.