A whiff of optimism for 2010: the recession is over and SMEs are feeling<br>confident

News provided by

Fonds de solidarité FTQ

Dec 04, 2009, 09:49 ET


    
                 SME Confidence Index - Solidarity Fund QFL
               November reading rises to 58 on a scale of 100
    
&lt;/pre&gt;
&lt;p/&gt;
&lt;p&gt;&lt;location&gt;MONTREAL&lt;/location&gt;, &lt;chron&gt;Dec. 4&lt;/chron&gt; /CNW Telbec/ - A sense of optimism will usher in 2010, with SME leaders believing that things will go well in the months ahead, a sign that the recession is now behind them. In fact, a full 88% reported feeling optimistic about the outlook for Québec SMEs, a 27% increase since &lt;chron&gt;February 2009&lt;/chron&gt;. Moreover, the vast majority (92%) are just as bullish about their own company's future in the year ahead, compared to 83% in February, according to the fifth SME Confidence Index - Solidarity Fund QFL, which registered a reading of 58 on a scale of 100, up two points (56) since September and seven points since February (51).&lt;/p&gt;
&lt;p/&gt;
&lt;p&gt;Hiring in store for 2010&lt;/p&gt;
&lt;p/&gt;
&lt;p&gt;As well, 52% of small and medium business owners - versus 45% in September - plan to hire in 2010, an encouraging sign that is consistent with the projected recovery. As for spending, more than half (58%) plan to make investments next year, either in acquisitions, expansion or modernization. This percentage is almost the same as in September (57%).&lt;/p&gt;
&lt;p&gt;"Throughout the year, the index allowed us to track the change in SME owners' confidence about their business and the economic outlook. The results of this fifth survey are encouraging, particularly on the recruitment and investment fronts. Because of the recent improvement in credit availability, SMEs now find it easier to contemplate expansion projects. With record investments of &lt;money&gt;$848 million&lt;/money&gt;, the Fund has played a dominant role this past year, which has been fraught with instability. Although most of these businesses (52%) indicate that they are still feeling the backlash of the economic crisis, it is extremely uplifting to see just how bold and enthusiastic they are. The Fund is all the more proud to be a partner of choice for SMEs because together, we drive the local economy," said Gaétan Morin, the Fund's executive vice-president of investments.&lt;/p&gt;
&lt;p/&gt;
&lt;p&gt;Growing dearth of specialized labour is still an issue&lt;/p&gt;
&lt;p/&gt;
&lt;p&gt;The results of the last survey show that labour is still a major issue, with 41% of business owners considering it a formidable challenge, followed by tougher competition (39%), customer attrition (37%) and late receivables (32%).&lt;/p&gt;
&lt;p&gt;"Business leaders confirm what we hear all around us. Everyone is talking about a turnaround in the financial markets but we're all still cautious in terms of hiring and investments," explains Léger Marketing president Jean-Marc Léger.&lt;/p&gt;
&lt;p&gt;The SME Confidence Index - Solidarity Fund QFL is a joint effort between the Fund and the research firm Léger Marketing. The index is based on a survey of SME owners' perception of the current economic situation, expected performance of their business, capital spending plans over the next 12 months, hiring intentions, and access to financing.&lt;/p&gt;
&lt;p/&gt;
&lt;pre&gt;
    
    Summary of results(1) - November 2009
    -------------------------------------------------------------------------
                                            Optimistic  Pessimistic  Neutral
    -------------------------------------------------------------------------
    Short-term outlook for SMEs in general      88%         12%         0%
    -------------------------------------------------------------------------
                                            Optimistic  Pessimistic  Neutral
    -------------------------------------------------------------------------
    Short-term outlook for your business        92%          8%         0%
    -------------------------------------------------------------------------
                                                Yes          No    Don't Know
    -------------------------------------------------------------------------
    Capital spending projects                   58%         31%        11%
    -------------------------------------------------------------------------
                                              Hiring    Laying Off  No Change
    -------------------------------------------------------------------------
    Hiring plans for the next 12 months         52%          8%        41%
    -------------------------------------------------------------------------
                                              Easier       Harder     Same
    -------------------------------------------------------------------------
    Access to financing                         65%         29%         6%
    -------------------------------------------------------------------------

    -------------------------------------------------------------------------
         Main Short-Term Issues for SMEs (multiple answers permitted)
    -------------------------------------------------------------------------
    Recruitment                             63%
    -------------------------------------------------------------------------
    Operating costs                         51%
    -------------------------------------------------------------------------
    Access and cost of financing            21%
    -------------------------------------------------------------------------
    Cost of raw materials                   16%
    -------------------------------------------------------------------------
    U.S. protectionism                      14%
    -------------------------------------------------------------------------
    Competition from emerging countries     12%
    -------------------------------------------------------------------------

    The complete survey is available at www.indicedeconfiancepme.com.
    
&lt;/pre&gt;
&lt;p/&gt;
&lt;p&gt;Methodology - The survey was conducted between &lt;chron&gt;November 17&lt;/chron&gt; and 22, 2009 among 200 Francophone and Anglophone Québec SMEs with 10 or more employees and sales of &lt;money&gt;$5 million&lt;/money&gt; and up. Participants were asked to complete the survey on Léger Marketing's secure Web site.&lt;/p&gt;
&lt;p&gt;Five questions make up the index, whose maximum score is 100. A reading of 0-20 indicates extreme pessimism, 21-40 means a worrisome situation, 41-60 reflects some concern, 61-80 indicates cautious optimism, and 81-100 means a high degree of optimism. The margin of error for a probability sample of 200 people is +/- 6.93%, 19 times out of 20.&lt;/p&gt;
&lt;p/&gt;
&lt;p&gt;About the Solidarity Fund QFL&lt;/p&gt;
&lt;p/&gt;
&lt;p&gt;The Solidarity Fund QFL helps drive our economy. With net assets of &lt;money&gt;$6.4 billion&lt;/money&gt; as at &lt;chron&gt;May 31, 2009&lt;/chron&gt;, the Fund is a development capital company that through its RRSP channels the savings of Quebecers into investments in all sectors of the economy to help create and maintain jobs and to further Québec's economic growth. The Fund is a partner, either directly or through its network members, in 2,000 companies. It currently has nearly 571,000 shareholders and has helped, on its own or with other financial partners, to create, maintain and protect nearly 143,000 jobs. For more information, visit &lt;a href="http://www.fondsftq.com"&gt;www.fondsftq.com&lt;/a&gt;.&lt;/p&gt;
&lt;pre&gt;
    
    ------------
    (1) Due to rounding and/or some unanswered questions, figures do not
        necessarily add up to 100%.

For further information: Note: The telephone number provided below is for the exclusive use of journalists and other media representatives. Source: Josée Lagacé, Senior Advisor, Press Relations and Communications, Solidarity Fund QFL Telephone, (514) 850-4835

Organization Profile

Fonds de solidarité FTQ