Inflation continues to be a top concern for rural businesses across Canada, as over 6 in 10 (62.4%) reported that it remained an obstacle in the fourth quarter of 2022. Despite this, the proportion of rural businesses reporting a positive outlook increased since the beginning of the year, reported Statistics Canada on Wednesday.
Statistics Canada
“Inflation and supply chain issues continued to be top concerns for businesses across rural Canada in the fourth quarter of 2022. Over three-fifths (62.4 per cent) of rural businesses expected rising inflation to be an obstacle over the next three months. Other short-term obstacles commonly cited by rural businesses included the rising cost of inputs (51.4 per cent), transportation costs (45.6 per cent) and rising interest rates and debt costs (40.2 per cent),” said the federal agency.
“These obstacles were more commonly cited by rural businesses than urban ones, with just over one-third (35.5 per cent) of urban businesses citing transportation costs as a short-term obstacle compared with just under half (45.6 per cent) of rural businesses.
“Despite these ongoing obstacles, the share of rural businesses in the fourth quarter of 2022 that reported a very optimistic outlook over the next 12 months increased compared with earlier in the year, climbing from 22.5 per cent in the first quarter of 2022 to 27.6 per cent in the fourth quarter. By comparison, the share of urban businesses that reported a very optimistic outlook was stable, at 22.8 per cent in the fourth quarter compared with 20.8 per cent in the first quarter.”
In the fourth quarter of 2022, more than half (52.1 per cent) of rural businesses expected their average wages to increase over the next 12 months, with 21.2 per cent expecting them to increase by 10 per cent or more. Faced with higher costs, over one-third (34.8 per cent) of rural businesses expected that the selling price of the goods and services they offered would increase over the next three months, reported StatsCan.
“In the fourth quarter of 2022, over half (51.9 per cent) of rural businesses reported that supply chain challenges had worsened over the previous three months, with a smaller number reporting that those challenges had stayed the same (44.3 per cent) or improved (3.9 per cent),” it said.
“Of those businesses that reported that supply chain obstacles had worsened, the majority attributed this to increased delays in deliveries of inputs, products or supplies (84.1 per cent), increased prices of inputs, products or supplies (76.4 per cent), and supply shortages that resulted in fewer inputs, products or supplies (74.2 per cent).
“The most common responses rural businesses planned in response to supply chain issues were substituting with alternate inputs (33.7 per cent), partnering with new suppliers (27.9 per cent) or working with suppliers to improve timeliness (25.6 per cent).”
(Mario Toneguzzi is Managing Editor of Canada’s Podcast. He has more than 40 years of experience as a daily newspaper writer, columnist, and editor. He worked for 35 years at the Calgary Herald, covering sports, crime, politics, health, faith, city and breaking news, and business. He works as well as a freelance writer for several national publications and as a consultant in communications and media relations/training. Mario was named in 2021 as one of the Top 10 Business Journalists in the World by PR News – the only Canadian to make the list)
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