Survey shows top five obstacles facing Metro Vancouver businesses in 2023
Rising inflation was the No. 1 concern for Metro Vancouver businesses, followed by increasing costs of materials and rising interest rates.
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Rapidly increasing costs are leaving Metro Vancouver businesses worried about a financial crunch in the new year, according to newly released data by the Greater Vancouver Board of Trade and the Canadian Chamber of Commerce’s Business Data Lab.
Rising inflation was the No. 1 concern for Metro businesses, followed by increasing costs of materials and rising interest rates. Real-estate-related costs and recruiting skilled employees rounded out the list.
“We need governments laser-focused on reducing barriers associated with doing business in our region,” Bridgitte Anderson, president and CEO of the Greater Vancouver Board of Trade, said in a statement.
Anderson said she would like to see local governments follow through on promises to expedite the permitting and licensing processes, while “investing more in training and upskilling the workforce.”
Anderson said a “looming wave” of retirements was only going to increase the pressure on businesses still struggling to find and retain staff. Business in virtually every industry reported experiencing staffing shortages, according to the survey, meaning competition for skilled staff could be fierce in the new year.
Three-quarters of businesses surveyed said they planned to raise wages in order to attract and retain staff, with technical workers in especially high demand.
“It will take a co-ordinated effort from the business community, education sector and governments to ensure that we have the skilled workforce our region needs to thrive,” Anderson said.
“Making growth-enabling investments in infrastructure, fostering innovation in the public and private sector, and working collaboratively to build a more integrated and inclusive workforce remain top priorities.”
On top of planning to pay higher wages, nearly half of businesses in Metro expect operating expenses to increase and profits to decline in the next three months. Two-thirds said they would likely pass cost increases on to customers.
Businesses in B.C. were also considerably more pessimistic about their future outlook over the next 12 months than those in the rest of Canada. Twenty-seven per cent of B.C. businesses reported feeling pessimistic about the coming year, compared with 18 per cent in the rest of Canada.
The hotel and restaurant industry face especially strong headwinds in the new year, with 62 per cent of survey respondents in the industry saying repaying COVID-19 debt will be “a major challenge.”
“The labour challenges and borrowing costs of the past year are beginning to manifest in a liquidity crunch that will put many of the businesses still carrying significant debt from the pandemic at risk,” Anderson said.
The Canadian Survey on Business Conditions was created in 2020 by Statistics Canada and the Canadian Chamber of Commerce. Surveys are conducted quarterly and the results from the Greater Vancouver Board of Trade were based on responses from 748 Metro employers. The most recent survey ran from Oct. 3 to Nov. 7, 2022.
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