47% of Canadian businesses reported rising input costs as major roadblock to expand their respective workforces
Labour market struggles weighing on purchasing power, says RBC
Ephraim Vecina
other
Fewer business owners are expecting an increase in profitability or employment count over the next three months
While global supply chain pressures have already shown signs of easing, growth in purchasing power seems to be plateauing as more businesses are reporting challenges when it comes to recruiting and retaining skilled employees, according to a new study by the Royal Bank of Canada.
RBC’s Q3 release of its regular Canadian Survey on Business Conditions showed that more than two-thirds of businesses remain at least somewhat optimistic about the outlook for the next year. On the other hand, fewer business owners are expecting an increase in profitability or employment count over the next three months.
Approximately 47% of Canadian businesses reported rising input costs as the major roadblock in their attempts to expand their respective workforces.
Read more: Mounting job vacancies strengthen case for further BoC hikes
“The amount of businesses reporting difficulties in acquiring inputs (domestically and from abroad) and maintaining inventories also dropped, in line with falling commodity prices and persistent moderation in supply chain conditions in recent months,” RBC said.
“Concerns about labour supply were also especially acute among businesses operating in recreation and leisure services, where the employment shortfall relative to pre-pandemic remains large.”
However, despite these challenges, only a minority (11%) of Canadian businesses are exploring the likelihood of adapting automation and digital technologies to cut down on the need to hire more people.
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