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Outlook of rural businesses, fourth quarter 2021

Released: 2022-01-12

As unemployment rates continued to decline in fall 2021, Canadian rural businesses continued to adapt to changing business conditions.

This analysis of the Canadian Survey on Business Conditions, fourth quarter of 2021, examines the evolving practices of rural businesses and their expectations for the future.

The rising cost of inputs is the most commonly expected obstacle for rural businesses

About half of rural businesses (49.4%) expected the rising cost of inputs to be an obstacle over the next three months, which has been the most frequently cited short-term obstacle since the first quarter of 2021. The three next most common short-term obstacles rural businesses cited in the fourth quarter of 2021 were difficulty acquiring inputs, products or supplies domestically (36.7%), cost of insurance (35.7%), and recruiting skilled employees (35.5%).

Chart 1  Chart 1: Top four obstacles for rural businesses over the next three months
Top four obstacles for rural businesses over the next three months

Supply chain difficulties are expected to persist

Slightly over half of rural businesses (50.5%) that were expecting difficulty acquiring inputs, products or supplies from within Canada in the short term expected these challenges to persist beyond six months. Meanwhile, 11.8% of rural businesses that anticipate difficulty acquiring inputs, products or supplies from within Canada expected the situation to improve within six months, while the remaining 37.7% were unsure how long the challenges will remain.

Just under half (48.9%) of rural businesses that anticipated having difficulty acquiring goods from abroad expected supply chain challenges to continue beyond six months.

Increasing employee wages planned by nearly half of rural businesses

There are a variety of different strategies available to rural businesses in terms of retention, recruitment and training. Just under half (49.1%) of rural businesses reported that they would be increasing wages for their existing employees within twelve months. Encouraging employees to participate in on-the-job training (28.3%) and increasing the wages offered to new employees (22.2%) were the other most common approaches that rural businesses were planning to take.

Chart 2  Chart 2: Most common recruitment, retention, and training plans for businesses
Most common recruitment, retention, and training plans for businesses

Rural businesses less likely to support teleworking than urban businesses

A greater share of rural businesses (80.9%) reported their work force would work exclusively on location over the next three months compared with urban businesses (61.5%). Among rural businesses that supported teleworking, 10.9% of their staff were expected to telework (either exclusively or some of the time).

Sale values from October to December are expected to match or exceed 2019 values for over half of rural businesses

Looking forward over the next 12 months, the majority of rural businesses (72.0%) were somewhat or very optimistic about their outlook of their business or organization. A smaller majority (58.5%) was optimistic about their future sales, reporting that they expected their sales over the upcoming months to match or exceed the values they saw in 2019.

About 12.6% of rural businesses expected that an absence of government support programs over the next 12 months would likely have a high impact on their survival. A similar percentage (13.6%) of rural businesses anticipated that repaying the funding received from repayable government support programs over the same period would be a major challenge.

  Note to readers

This analysis focuses on businesses in rural areas, using fourth quarter 2021 results from the Canadian Survey on Business Conditions. The 2016 Census Subdivision Boundary File was used to identify all businesses' census subdivisions (CSD) based on location. Businesses located in CSDs classified as either census metropolitan areas or census agglomerations were classified as urban. All businesses in other locations were classified as rural.

This survey was conducted by Statistics Canada from October 1 to November 5, 2021, to develop an understanding of the current practices of businesses and of their expectations moving forward. When respondents were asked questions pertaining to their expectations over the next three months, that three-month period could range over the period from October 1, 2021 to February 5, 2022, depending on when the business responded. Similar date ranges apply to questions pertaining to expectations over the next 12 months.

Products

The full article "The outlook of rural businesses, fourth quarter of 2021" is now available as part of the series StatCan COVID-19: Data to Insights for a Better Canada (Catalogue number45280001).

Contact information

For more information, or to enquire about the concepts, methods or data quality of this release, contact us (toll-free 1-800-263-1136; 514-283-8300; infostats@statcan.gc.ca) or Media Relations (statcan.mediahotline-ligneinfomedias.statcan@statcan.gc.ca).

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