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Economic outlook uncertain: new CPA Canada survey

Optimism and pessimism about the economy are running neck to neck, according to the Q3 Business Monitor results

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Peace tower of the Canadian ParliamentHaving a federal minority government was the top concern for 10 per cent of survey takers (Shutterstock/Marc Bruxelle)

It’s been a confusing quarter for Canadians, with trade wars potentially slowing down global gross domestic product (GDP) growth, continued concerns over oil prices impacting the Canadian economy, and other geopolitical issues—such as Brexit and the U.S. impeachment process—weighing on people’s minds. It’s no wonder then that the latest CPA Canada Business Monitor survey (Q3 2019), which looks at how professional accountants in leadership positions feel about the economy, has produced mixed results. 

The survey, which was conducted in November, found that 28 per cent of the respondents who took part are feeling pessimistic about the Canadian economy over the next 12 months, while the same number said they’re optimistic. Another 44 per cent took no position as they’re not sure what to expect. In last quarter’s survey, 31 per cent were optimistic and 24 per cent were pessimistic, which means that, overall, these business leaders are feeling a little less hopeful about the economy’s performance going forward. 

When it comes to what’s worrying Canadian accountants, 15 per cent said the Canadian economy, while U.S. protectionism, the state of the U.S. economy and a lack of skilled workers all received 11 per cent of responses. Having a federal minority government was the top concern for 10 per cent of survey takers.

“It makes sense for Canadian business leaders to be taking a wait-and-see approach,” says Joy Thomas, president and CEO of CPA Canada. “So much is in play when you consider there is a minority government in Canada along with the potential for economic surprises, whether they be stateside or overseas, especially when it comes to trade.” 

Pedro Antunes, chief economist with the Conference Board of Canada, isn’t surprised by these results, with other business monitors, including the Conference Board’s own, showing slightly more pessimism as well. “There’s been a lot of fear,” he says.


However, Antunes thinks business confidence could rise over the next several months, as some of these issues may finally get resolved. For instance, the Brexit deadline has been extended and it now appears that some sort of deal could be made. Antunes also thinks the U.S.-China trade war might cool as no president wants to see inflation rise and consumers be under pressure during an election year. “I’ve been wrong about the president’s intentions in the past, but I do think we may see a de-escalation in 2020, while recession risks have eased,” he says.

When it comes to the Canadian economy, there are some good reasons as to why people may be feeling a little uneasy. The Canada-U.S.-Mexico Agreement has not yet been ratified, business investment has, for the most part, lagged the U.S., while access to labour is becoming a bigger issue, especially with the Canadian economy adding about 450,000 jobs over the past year. “All of this has generated a fair bit of uncertainty when it comes to investment in Canada,” he says. 


However, according to the latest Business Monitor, this increase in pessimism isn’t impacting Canadian business in a significant way. While people may be unsure about the economy, they are more bullish about their own businesses, with 48 per cent saying they’re optimistic about the prospects for their company over the next 12 months. Only 18 per cent said they’re pessimistic, while 33 per cent remained neutral. Two-thirds of companies think their company’s revenues will rise over the next 12 months, while 59 per cent expect increased profits and 45 per cent anticipate an increase in staff.

“That’s good news,” says Antunes, adding that while manufacturing and industrial production has seen a decline in business investment, the service sector, where many of CPA Canada’s members work, continues to thrive. “In the service sector, it’s the worker driving the value add and this area is supporting employment.”

It’s always hard to know where things might go these days, says Antunes, but it’s possible that the next survey will yield different results, especially if trade issues improve. “This year has not been great for trade, but we could see an improvement in 2020,” he says. “Let’s hope the economy can continue to forge ahead.”


The CPA Canada Business Monitor, commissioned by CPA Canada and conducted by Nielsen, is issued quarterly. For the Q3 2019 study, emailed surveys were completed by 386 of 3,903 people identified as holding senior positions in industry between October 31 to November 17, 2019.