B.C. business leaders are less confident about future business success than they have been in years, according to a Business in Vancouver/Ipsos Reid poll conducted between July 4 and 10.
The 170 executives surveyed were more concerned about sales and staff needs than they have been in previous surveys.
“The trend is unmistakable,” said Steve Mossop who is Ipsos’ western region president. “Confidence has dropped off considerably since the optimism of the first quarter.”
In early 2011, 64% of executives projected that sales would be higher in the next 12 months. That dropped to 48% in the July survey.
Conversely, 26% of executives now say that they believe sales will be lower in the next year. That’s double the 13% of executives who felt that way in early 2011. A more striking example of shrinking confidence is that 22% of executives believed that they would need fewer employees in the next year than they currently need. That’s up from 10% in early 2011.
Back in 2011’s first quarter, 37% of executives anticipated that staffing needs would rise. That’s now shrunk to a mere 24%.
“The other categories that haven’t really dropped off significantly are profits and capital expenditures and space requirements,” Mossop said. “If you look at the macro-economy, that holds true. Companies are managing to cut costs even in the face of flat to slowly increasing sales.”
Executives believe their industry’s prospects are similar to the prospects for their businesses.
The July 4 to 10 poll also found that 70% of business leaders support the harmonized sales tax (HST) mainly because they believe:
- it’s good for their business; and
- the negative impact of scrapping the tax and returning to a PST-GST combined tax will have much worse lingering effects than simply keeping the HST.
Other survey results:
- 44% of respondents believe the HST will have a positive impact on their business;
- 22% said keeping the tax will hurt their business;
- 22% believe scrapping the HST would help business; and
- 51% said scrapping the harmonized tax would hurt their business.
Despite the findings, the fiercest opponents of the tax outnumber the most strident supporters. About 6% of those surveyed said scrapping the HST will have a “very positive impact” on their business. That’s double the 3% of business leaders who said keeping the HST will have a “very positive impact” on their business.
Nearly four-fifths (79%) of the business leaders surveyed in the BIV/Ipsos poll believe their enterprise was unaffected by the June 15 Stanley Cup riot in downtown Vancouver. A few percent of the 170 business leaders surveyed did not know whether their business was affected while the remaining 18% figured that the violence and hooliganism affected their business, either slightly or moderately.
“There must have been repercussions on businesses other than simply those which had their windows smashed,” said Mossop. “So the impact of the riot was more widespread than maybe you would have thought. This is a B.C.-wide survey of opinion leaders, so it’s not just the Howe Street or Granville Street corridors. So, for 18% to say that their business is affected, that’s amazing.”
The survey also found that:
- 23% of respondents oppose large outdoor gatherings of people on public streets in Vancouver’s downtown core; and
- 74% support such gatherings.
“Even with all the damage and destruction, business leaders are saying, ‘Don’t put a damper on outdoor gatherings. We strongly support it,’” Mossop said.
The margin of error in the poll is plus or minus 7.5%.