Sentiment among small and medium-sized businesses improved in June, according to the Canadian Federation of Independent Business (CFIB) Barometer Survey.
The long-term 12-month confidence index rose more than seven points to 47.3 in June from 40.1 in May. The short-term index also gained 5.1 points to 47.7, up from 42.6. Despite the improvements, confidence remained below the neutral benchmark of 50, due to tariff-related uncertainties.
Canadian exporters and importers remained downbeat, but sentiment firmed. The exporter index rose to 36.1 points from 26.8, while importer sentiment increased to 37.4 points from 28.1. These index values are still well below their levels in the 60s at the end of 2024.
In B.C., the long-term index climbed 15.1 points to 53.4, the second-highest improvement among provinces, just behind PEI. The short-term index also improved to reach its highest level since July 2024. B.C.’s short-term sentiment is third highest among provinces, trailing only PEI and Nova Scotia. This could reflect B.C.’s export diversification and less exposure to the U.S. market.
Insufficient demand and skilled labour shortages continued to be the most cited constraints on sales or production growth. Tax and regulatory costs, wage costs and insurance costs were the top input cost constraints, with occupancy, product input and fuel costs also on the list. Full-time staffing plans improved, with 15 per cent of businesses expecting to increase staff levels. Twenty per cent still plan to reduce full-time staffing.
B.C. MLS sales fell for the sixth consecutive month in May. On a seasonally adjusted basis, home sales declined 0.5 per cent to 5,345 units. This followed a 1.7 per cent decline in April and marked one of the lowest monthly sales figures since the last quarter of 2023. Sales are also 13.4 per cent lower than a year ago. Economic uncertainty, challenging affordability conditions, and limited investment demand have curbed activity.
In the Greater Â鶹´«Ã½Ó³»Area, home sales decreased 1.2 per cent, while falling 4.2 per cent on Â鶹´«Ã½Ó³»Island (excluding Victoria). Home sales dropped 20.3 per cent in Chilliwack and 7.0 per cent in South Okanagan. In Northern B.C., sales fell 9.2 per cent. In contrast, home sales rose in Victoria (7.2 per cent), Okanagan Mainline (2.4 per cent), Kootenay (three per cent), and Kamloops (0.6 per cent).
The average home price in B.C. increased two per cent in May to $941,300, now sitting 12.3 per cent below the historical peak in February 2022. While new listings fell 0.5 per cent, market conditions modestly favoured buyers, reflected in a sales-to-new listings ratio of 38.8 per cent in May, unchanged from April.
Regionally, higher prices were recorded in Greater Â鶹´«Ã½Ó³»(1.6 per cent), Â鶹´«Ã½Ó³»Island (excluding Victoria) (1.4 per cent), South Okanagan (5.0 per cent), Okanagan Mainline (1.3 per cent), and Northern B.C. (0.6 per cent), while other regions saw price declines.
Benchmark constant-quality measures continued to decline in most areas. In the Lower Mainland, the index decreased 0.9 per cent, down 0.3 per cent in the Okanagan, and 0.7 per cent on Â鶹´«Ã½Ó³»Island.
Although economic indicators are softening, underlying resilience, moderating prices, and easing of tariff-related fears may encourage more buyers to re-enter the market in the coming months. However, persistent uncertainty will limit a recovery.
Bryan Yu is chief economist at Central 1.
