While many organizations remain optimistic about their own growth prospects, serious labour and cost challenges prevail—and they’re taking a toll. The resounding message emerging is also clear: they feel government needs to pave the way for sustainable economic growth.
We love that the majority of organizations are optimistic. In fact, we would attribute that largely to the unwavering Atlantic Canadian spirit and capacity for resilience we have in the face of challenge. Our businesses persevere because they see themselves as progressive, builders, change makers and risk takers.
This year they’ve said they have their targets set on growth (83%), many believe they’re in ‘good or very good’ shape (61%) and that nearly 80% describe their prospects as ‘good or very good’ over the next 3-5 years. However, there is a continued and growing concern about recruitment and retention, with 72% saying it’s the primary challenge they face. In fact, only 6% said recruitment and retention has ‘not’ impacted their profitability at all.
We’re hearing there are several factors causing businesses greater uncertainty. The cost of labour, measures to combat reduced availability of qualified and skilled workers, the cost of doing business, taxes, business regulations, and the cost of technology are all worsening. And of course, these feelings of uncertainty are compounded by the fact their confidence in the economy is down regionally, nationally, and globally.
The challenges Atlantic Canadian businesses are facing have serious implications for our economic future. Organizations are working harder and paying more to recruit and retain workers, but they are also changing their plans for growth and reducing both their output and operating hours to cope with current shortages. But these measures are simply not sustainable in the long term and will negatively impact both our businesses and the region's economic growth.
It is vital that governments provide support to businesses and work together to improve conditions. In our 2022-2023 Atlantic Insights report, organizations indicated their provincial government has the biggest impact on their organization. To this end, they want their government to offer more support for small and medium-sized enterprises, help increase the availability of qualified workers, and reduce the growing costs of doing business.
Governments in Atlantic Canada can implement various measures to aid businesses in their province. One such measure is to enhance funding of educational and training programs that enable workers to acquire the necessary skills to fulfill the region's workforce needs. They can also pave the way in Atlantic Canada to increase in the supply of housing. Affordable and accessible housing is required to attract the talent businesses need and is a necessity to growing the economy.
Another approach government can take includes supporting businesses by reducing regulatory burden, also known as, red tape. Red tape reduction can save businesses both time and operating costs and is one of the most cost-effective measures that can be used in creating economic growth.
The challenges businesses currently face are certainly not new (nor surprising), but neither is the unbreakable spirit of optimism and resilience we see from the Atlantic Canadians who lead these organizations – all of which continue to growing with each passing year. However, we must not rely solely on the grit and resilience of our businesses to overcome all of the challenges that have been so clearly visible in the road ahead for several years. This just isn’t good economic strategy. But creating a landscape for growth based on better conditions for business has certainly proven effective.
For the private sector to thrive, businesses will need government to be there as a partner to create an environment that encourages and incentivises the many businesses that keep our economy going.
Sheri Somerville is the CEO of the Atlantic Chamber of Commerce, a nationally accredited organization representing more than 16,000 businesses in Atlantic Canada and their 300,000 employees through its network 90 Chambers of Commerce and corporate partners.
