Small business confidence falls steeply in May
Toronto, May 21, 2026 – Small business confidence dropped 11.7 factors in May, falling to 46.3, finds the Monthly Business Barometer by the Canadian Federation of Independent Business (CFIB).
The long-term optimism index dropped considerably this month falling under the 50-point threshold. Every province and each sector posted a decline. Fuel prices remained the highest strain level, cited by practically three quarters (72%) of small companies. Weak client demand continues to be the lead value constraint (53%).
“Many small firms are stuck in a grind. Demand is weak, costs – especially fuel – are high, and conditions don’t show signs of improving. This environment is not conducive to strong orders or investment,” stated Andreea Bourgeois, CFIB director of economics.
Average wage plans have been unchanged at 2.4%, whereas companies plan to lift costs by a median of three.1% in the subsequent few months.
“This is not the direction we’d like to see this data point go. Higher oil prices add upward pressure on inflation, while tariffs and other economic challenges are still weighing on economic growth. With the next Bank of Canada interest rate decision only weeks away, it is a tough spot to be in. This is the second month we’ve seen price increase plans above 3%, and now we have to ask: is this the beginning of a new upward trend?” Bourgeois added.
Hiring intentions stay weak and under seasonal ranges, with 14% of small corporations seeking to rent full-time in the subsequent few months.
“While our governments don’t have control over global events, they can control what’s happening here at home. It’s important governments leverage domestic policies to boost our economy. Lowering taxes, reducing red tape and eliminating internal trade barriers are some of the ways to help small businesses weather the current challenges,” stated Simon Gaudreault, CFIB chief economist and vice-president of analysis. “It’s in the moments like these that we can transform the nation by creating conditions that will outlast the current crisis and pay off in the long term.”
For media inquiries or interviews, please contact:
Dariya Baiguzhiyeva, CFIB
647-464-2814
Public.affairs@cfib.ca
Methodology
May Business Barometer®: May findings are primarily based on responses from a stratified random pattern of CFIB members, to a controlled-access internet survey. Data displays 563 responses obtained from May 5-12. Findings are statistically correct to +/- 4.1 per cent, 19 occasions in 20. Every new month, the whole sequence of indicators is recalculated for the earlier month to incorporate all survey responses obtained in that earlier month. Measured on a scale between 0 and 100, an index under 50 means homeowners anticipating their business’s efficiency to be weaker over the subsequent three or 12 months outnumber these anticipating stronger efficiency.
About CFIB
The Canadian Federation of Independent Business (CFIB) is Canada’s largest affiliation of small and medium-sized companies with 103,000 members throughout each trade and area. CFIB is devoted to growing business homeowners’ probabilities of success by driving coverage change in any respect ranges of presidency, offering professional recommendation and instruments, and negotiating unique financial savings. Learn extra at cfib.ca.
