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Despite lingering inflation concerns, Canadian businesses are still relatively optimistic heading into 2025, according to new research from Statistics Canada.

The latest quarterly survey of business conditions, which was carried out between Jan. 2 and Feb. 6 by the national statistical agency, found that 62.5% of survey respondents were concerned about the cost pressures facing their operations — including inflation, rising input costs, labour expenses, interest rates and transportation costs, among others.   

The survey came in the wake of an 11.8% year-over-year rise in StatCan’s Raw Materials Price Index, and a 4.0% increase in average hourly wages, in December 2024. 

Against this backdrop, the survey found that almost half (46.4%) of respondents cited inflation as an expected obstacle in the next three months, followed by input and insurance costs (26.7%). 

Of the businesses that were concerned about input costs, the survey found that 61.6% specified labour costs as their primary concern.

And, it reported that 43.8% of businesses said that they expected to increase wages over the next 12 months, with the anticipated average wage increase of 7.0%. A similar share of firms, 44.6%, said they expected wages to remain stable, and 3.1% expected their wage bills to decline.

Despite these concerns about rising costs generally, and labour costs specifically, the research reported that 73.1% of respondents said they were either “very optimistic” or “somewhat optimistic” about their outlook for the next 12 months. 

The survey also found that just 16.7% of businesses expected their sales to increase over the next three months, unchanged from the fourth quarter of 2024.

Moreover, 24.8% of businesses surveyed said they expected to raise their prices in the next three months, StatCan reported.