This year, Business in Vancouver is partnering with Ipsos Reid in quarterly surveys to gauge the confidence of B.C. business leaders in their companies and sectors, the overall economy, political priorities and all three levels of government.
Of the 285 surveyed between December 28 and January 9 in this 2011 first-quarter poll, 34% were either the president or CEO of their company while 20% were owners. Others were either self-employed, managers, directors, partners or other executives.
B.C. business leaders are more confident than they were last year that sales and profits will rise in their businesses in the coming year. Confidence is so high that the executives believe it’s more likely that they will hire a worker this year than they did last year. They’re also more likely to make large capital investments.
Their confidence, however, pales in comparison to levels seen at the start of 2008 when the B.C. economy was firing on all cylinders. The survey found that 64% of the executives believe sales will increase in 2011. That’s up from 61% a year ago but down from 73% in 2008.
PricewaterhouseCoopers released a survey January 25 that found global business leaders are similarly more optimistic. According to the international poll, 48% of corporate leaders are “very confident” about growth in the next 12 months compared with only 31% a year ago.
“CEOs always tend to overestimate their own performance and underestimate the general economy as a whole,” Ipsos’ western region president Steve Mossop said of the BIV-Ipsos survey.Business leaders surveyed believe there’s only a 51% chance that their sales will increase. That’s down from 52% last year and 64% prior to the economic downturn.
Projections for the B.C. economy are relatively positive even though fewer executives forecast stronger growth than they did last year.
Only 14% of executives believe the B.C. economy will be less active in the coming year. Last year 19% of executives projected that outcome.
About 34% of executives believe B.C.’s economy will stagnate in 2011.
That’s up from 20% of business leaders who thought that in 2010.
According to the BIV-Ipsos survey, business leaders, at first glance, appear to want the B.C. government to spend less on health care and more on transit.
Controlling health-care costs is a high priority for 89% of the business leaders surveyed, while investing in transportation infrastructure is a high priority for 82%.
But Mossop said that doesn’t necessarily mean business leaders want government to reduce health-care spending and divert those savings into SkyTrain, highways and bridges.
“They just want it both ways,” Mossop said. “It’s the age-old juxtaposition of taxation issues that always seems to come up when we poll on that issue.”
Mossop pointed out that the survey found a slight shift to business leaders wanting frugality and restraint.
More executives in 2011 (75%) want Victoria to make paying down provincial-government debt a high priority. That compares with 71% who wanted that last year. Similarly, reducing the government’s budget deficit is a high priority this year for 80% of survey respondents compared with 78% last year.
Far less consensus emerged on the harmonized sales tax (HST). Consumers have consistently told pollsters that they oppose the HST.
But business leaders are split on the issue:
- 35% believe the HST will have a positive impact on their business;
- 40% believe it will have a negative impact; and
- 25% said the harmonized tax will have no effect.
support while Vision Vancouver bleeds
Local business leaders have warmed to Stephen Harper’s Conservative government and cooled markedly on Gregor Robertson’s Vision Vancouver civic administration, which has a level of support that Mossop calls “horrific.”
The BIV-Ipsos survey found that 59% of business leaders disapprove of Robertson’s administration. A year ago, only 36% disapproved of Robertson’s civic team.
Robertson’s popularity is now below the 58% disapproval rating that former mayor Sam Sullivan’s Non Partisan Association (NPA) administration endured in 2008.
Sullivan’s unpopularity with business leaders likely sparked party infighting severe enough to cost Sullivan the NPA’s mayoral nomination and for the NPA to stumble from having a council majority to retaining only a single council seat in the 2008 civic election.
“It’s not necessarily that bad [for Robertson] because business leaders can feel different from other voters,” Mossop said. “But there is a pretty major constituent group that is seriously unhappy with the performance of his government.”
Approval for Harper’s Conservative government in Ottawa, conversely, is rising.
Harper’s government has raised its approval rating among B.C. business leaders to 66% today from 52% one year ago.
“That’s an amazing jump,” Mossop said.
Provincially, the BC Liberals have held their approval rating steady at 52% – something that Mossop believes is still impressive given the level of backlash that the party generated by introducing the HST.
“Businesses are divided on the HST, but they’re universally behind the Liberal government,” he said. “That’s despite the opposite sentiment among consumers.” •