new data from Canadian Federation of Independent Business (CFIB) Shows that optimism is waning ahead of the new year for many of Alberta’s small businesses, with nearly a quarter at risk of closure.
According to the CFIB’s Small Business Recovery Dashboard, 24 per cent of small Alberta businesses are at risk of closing their doors – the most in the country.
Manitoba followed Alberta with 20 percent of its small businesses at risk of closing, followed by BC, Ontario and PEI at 19 percent.
CFIB Alberta director Annie Dormuth told Global News that the retail, agriculture and construction sectors have felt the biggest impact.
“All these complex challenges and the slow economic recovery,” Dormuth said. “Every business owner thought the end of 2022 was going to be a huge economic boom…it just wasn’t.”
Data showed 54 per cent of Alberta’s small businesses have not returned to pre-pandemic, or normal, revenue.
Nationally, small business owners have a more optimistic outlook on 2023 than last month, but short-term confidence is declining.
The CFIB’s Small Business Confidence Index showed short-term confidence in the economy among Alberta’s small businesses sitting at 44 index points, relatively unchanged from last month. The long-term confidence index rose nearly three points to 52.9 index points.
Dormuth said the lack of short-term confidence among the province’s small business owners is due to the uncertainty of the first few months of the year.
“All of this is compounded by challenges in the form of rising interest rates and inflation,” Dormuth said. “All of this is putting a lot of uncertainty on business owners.”
In Edmonton, that uncertainty has created new challenges for Paul Shufelt, chef and owner of Robert Spencer Hospitality.
The group offers catering and owns four restaurants, and it faces a tough 2022.
“The pandemic seems to be subsiding a bit, we are going back to normal. Oh wait, now we have major supply chain issues, staff shortages. If that’s not enough, we’ve got inflation and doubling or tripling the cost of everything — if you can even find it in the first place,” Shufelt told Global News. “It’s like death by 1,000 cuts.”
Shufelt said the business is working daily on the delicate balance of charging enough to keep doors open, while also keeping prices fair to its customers.
While there is hope that January 2023 will be better for business than last year, now with the easing of pandemic health measures, Shufelt said there are still concerns over a “looming recession” and interest rate hikes.
“It’s apprehension,” he said. “It’s still looking for that light at the end of the tunnel.”
However, there is “moderate” optimism at Madame Premier, a retail store in Calgary’s Inglewood neighborhood.
Its founder, Sarah Elder-Chamanara, said the year was more challenging than expected, but with a return to normal, with sales improving especially during Black Friday and the holidays.
“December is such an important month for retailers,” he told Global News. “How well we do in December is a barometer of how much strength and confidence we can carry into the new year.”
The business didn’t take the credit of the pandemic like many others across the province.
CFIB data shows two-thirds of Alberta’s small businesses are still working to pay off debt incurred by the COVID-19 pandemic.
But Elder-Chamanara said support for small businesses is still needed as much as it was in the last two years.
“It was a bit disappointing during the holiday season because, in this return to normal, we lost our focus on the local shop; There was so much emphasis on this during the pandemic,” she said. “Now that the world is open again, the focus still has to be on the local.”
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