Canadian Survey on Business Conditions, third quarter 2026
Released: 2026-08-31
Businesses continue to anticipate a variety of obstacles over the next three months (see Note to readers). While pressures of cost-related obstacles continued into the third quarter, the proportion of businesses with a positive outlook remained relatively steady compared with previous quarters in 2026.
Real gross domestic product grew 0.3% in June, increasing for a third consecutive month. Meanwhile, consumer inflation rose 3.0% year over year in July, following a 2.8% gain in June. Furthermore, employment increased by 75,000 (+0.4%) in July, and the employment rate rose 0.1 percentage points to 60.9%.
It was in this macroeconomic context that Statistics Canada conducted the Canadian Survey on Business Conditions from July to August 2026. The survey collects information on the environment businesses are currently operating in and their expectations moving forward.
Smaller proportion of businesses expect cost-related obstacles
In the third quarter, 59.8% of businesses across Canada expect cost-related obstacles over the next three months, an improvement from 64.3% in the second quarter. For the Canadian Survey on Business Conditions, cost-related obstacles consist of inflation; cost of inputs; interest rates and debt costs; cost of insurance; cost of real estate, leasing or property taxes; as well as transportation costs. In July, prices of raw materials purchased by manufacturers operating in Canada, as measured by the Raw Materials Price Index (RMPI), decreased 2.2% from June, but they were 18.1% higher than one year earlier. However, average hourly wages among employees rose 2.8% year over year in July, following a gain of 3.3% in June.
Meanwhile, two in five businesses (41.6%) expect inflation to be an obstacle over the next three months, making it the most commonly expected obstacle among businesses in the third quarter. The businesses that expect this obstacle the most are those in accommodation and food services (58.3%), construction (51.8%) and manufacturing (48.7%).
Recruiting skilled employees is the second most commonly expected obstacle in the third quarter, anticipated by one-quarter (25.2%) of businesses, led by those in manufacturing (38.2%), accommodation and food services (33.6%) and health care and social assistance (31.7%).
When asked to identify the most challenging expected obstacle over the next three months, 12.4% of businesses expected it to be inflation, 8.9% indicated recruiting skilled employees and 7.2% reported the cost of inputs.
Nearly one-third of businesses expect a negative impact from tariffs imposed by the United States on imports from Canada over the next 12 months
In the third quarter, nearly one in three businesses (32.2%), whether they engaged in trade or not, expect the imposition of tariffs by the United States on imports from Canada to have a negative impact on their business over the next 12 months. Businesses in manufacturing (49.7%), transportation and warehousing (47.3%) and wholesale trade (45.1%) were most likely to indicate this. Meanwhile, nearly half (46.9%) expect that the imposition of tariffs by the United States on imports from Canada will have no impact on their business over the next 12 months, while 19.8% of businesses were unsure and 1.0% expect a positive impact.
Over one-quarter of businesses passed cost increases due to tariffs onto customers over the 12 months preceding the survey
In the third quarter, businesses were asked whether they had passed cost increases due to tariffs onto their customers over the 12 months prior to the survey, whether they engaged in international trade or not. Over one-quarter (27.4%) of businesses reported having done so, while nearly two-fifths (37.7%) reported not passing any cost increases onto their customers. Meanwhile, over one-third (34.9%) of businesses did not experience any cost increases due to tariffs.
Looking ahead, 3 in 10 businesses (30.4%) reported being either very or somewhat likely to pass cost increases due to tariffs onto their customers over the next 12 months. In contrast, 14.7% were either very or somewhat unlikely to do the same, and 18.7% were unsure. Lastly, nearly two-fifths (36.3%) of businesses did not expect to pass any cost increases due to tariffs onto their customers over the next 12 months.
Majority of businesses have no plans to use artificial intelligence over the next 12 months
In the third quarter, one-quarter (25.2%) of businesses report having plans to use artificial intelligence (AI) over the next 12 months, up from 14.5% in the third quarter of 2025 and 10.6% in the third quarter of 2024. However, in the third quarter of 2026, more than half (52.7%) of businesses have no plans to use AI to produce goods or deliver services over the next 12 months, a smaller proportion than businesses in the third quarter of 2025 (66.7%) and the third quarter of 2024 (71.8%). In the third quarter of 2026, among businesses that do not plan to adopt AI over the next 12 months, the vast majority (79.1%) feel AI is not relevant to the goods they produce or services they deliver. Moreover, when asked for their reasons for not planning to use AI over the next 12 months, 10.8% cited concerns about privacy or security and 9.9% reported that there is a lack of knowledge on the capabilities of AI.
Most businesses have not experienced theft of sensitive business data over the last 12 months
In the third quarter, 2.7% of businesses reported experiencing theft of sensitive business data, such as intellectual property, business intelligence or customer or employee data over the past 12 months. This was most reported by businesses in manufacturing (5.7%), accommodation and food services (4.5%) and professional, scientific and technical services (4.4%).
Businesses that experienced theft of sensitive business data in the past 12 months reported experiencing events such as unauthorized access to systems or data (67.2%), theft or attempted theft of intellectual property, trade secrets or sensitive information (29.0%) and suspicious requests or engagements (25.3%). Some businesses experienced multiple events. Among businesses that experienced theft, over half (50.5%) said it increased cybersecurity or security-related costs, nearly half (49.6%) reported that the business incurred financial losses and 47.6% said they were impacted by operational disruptions.
Business optimism remains relatively steady so far in 2026
In the third quarter, nearly three-quarters (72.6%) of businesses are either very or somewhat optimistic about their outlook over the next 12 months, similar to the proportions of businesses that reported the same sentiments in the second quarter (66.8%) and first quarter (72.3%).
Meanwhile, in the third quarter, 14.5% of businesses expect their sales of goods or services to increase over the next three months, a decrease from 19.4% in the second quarter. In the third quarter, 13.9% of businesses expect sales of their goods or services to decrease, while 20.6% of businesses anticipate the selling price of their goods or services to increase. Businesses most likely to expect their selling prices to increase over the next three months are those in accommodation and food services (34.6%), wholesale trade (29.6%) and retail trade (27.8%).
Note to readers
Data from the Canadian Survey on Business Conditions are now available. The tables provide data at the national, provincial and territorial levels by industrial sector, employment size, type of business and majority ownership. Data are also available upon request for the 20 largest cities in Canada.
Results from this survey are applicable to employer businesses in Canada. This survey is conducted quarterly to collect information from businesses in Canada more efficiently and rapidly compared with traditional methods.
The most recent survey was conducted from July 2 to August 6, 2026, and respondents were asked about their expectations for the next three months. As a result, this three-month period could range from July 2 to November 6, 2026, depending on when the business responded.
Statistics Canada would like to thank Canadians who took the time to complete this survey, enabling a better understanding of Canadian businesses.
Please note that this will be the final iteration of the Canadian Survey on Business Conditions. Statistics Canada wishes to thank Canadian businesses for their participation in the survey since 2020. To learn how the agency is adapting to continue delivering quality data Canadians rely on, visit Delivering trusted data through change.
Correction
On August 31, 2026, a correction was made to the text about tariffs. The original text stated that two in three businesses expect a negative impact from tariffs, but should have said that one in three businesses expect such an impact.
Products
The infographic "Business conditions in Canada, third quarter of 2026," part of the series Statistics Canada—Infographics (11-627-M), is now available.
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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