Toronto, March 20, 2025 – Ontario’s long-term business confidence level nosedived this month to an all-time low and second worst in the country, dropping 30.2 points to 23.4, according to the Canadian Federation of Independent Business (CFIB)’s Business Barometer® index.
This mark is lower than the scores registered during the 2020 pandemic, 2008 financial crisis or 9/11. A score of 60 would be achieved under more normal economic conditions, based on the long-term (12-month) indicator’s historical average.
“It’s impossible to make decisions on hiring, expanding and other operational matters against the backdrop of ever-changing tariffs,” said Julie Kwiecinski, CFIB’s director of provincial affairs for Ontario. “To survive tariff uncertainty, businesses have to plan for the worst possible scenarios.”
For the past 19 consecutive months, Ontario small businesses have rated insufficient demand for their products and services as the top barrier to sales or growth, making it a challenge to get ahead of rising costs and outstanding debt. Almost one-third (31%) of the province’s small businesses are still holding pandemic-related debt, with a median debt of $80,000.
Weak small business optimism in Ontario is negatively affecting hiring plans, as 16% of small firms in the province are planning to lay off in the next few months (up from 14% in February), and only 11% are looking to hire (down from 13% in February).
Nationally, confidence among all sectors fell dramatically, with hospitality (17.0), manufacturing (18.6), transportation (21.0), and agriculture (21.3) at the bottom of the sectoral list. In addition to U.S. tariffs, Canadian agri-businesses are facing 100% tariffs from China on canola oil, peas and oil cakes, as well as 25% tariffs on pork and aquatic products like lobsters.
“Small businesses urgently need all the help they can get to weather this storm,” said Kwiecinski. “The Ontario government can best help with measures like lowering the Small Business Tax Rate and increasing its threshold, and keeping the campaign commitment to provide $3B in Employer Health Tax and WSIB surplus funds relief as part of the province’s tariff mitigation measures.”
During the recent Ontario election campaign, CFIB surveyed 1,812 small business owners in person on their priorities for the next Ontario government and the best measures to help them deal with U.S. tariff impacts. In both cases, reducing the Small Business Tax Rate (SBTR) topped the list. As noted in CFIB’s 2025 Top 10 Ontario Election Priorities, we specifically urge the Ontario government to:
• Immediately lower the SBTR from 3.2-2%, with a plan to gradually bring it down to 0%.
• Increase the threshold to access the SBTR from $500,000 to at least $700,000, and index it to inflation annually.
For media inquiries or interviews, please contact:
Dariya Baiguzhiyeva, CFIB
647-464-2814
public.affairs@cfib.ca
About CFIB
The Canadian Federation of Independent Business (CFIB) is Canada’s largest association of small- and medium-sized businesses with 100,000 members across every industry and region, including 39,000 in Ontario. CFIB is dedicated to increasing business owners’ chances of success by driving policy change at all levels of government, providing expert advice and tools, and negotiating exclusive savings. Learn more at cfib.ca.
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