OTTAWA — A survey of chartered accountants at some of Canada’s leading companies suggests they are becoming more confident about the economy and less fearful of a recession this year.
The quarterly sampling by the Canadian Institute of Chartered Accountants and the Royal Bank, taken in November, finds that those predicting a recession has dropped by about half from three months earlier.
Only 14 per cent of the 311 CAs who responded to the email survey thought Canada would slip into a recession in the next six months, compared with 27 per cent three months earlier.
As well, two-thirds said they expected revenues at their firms to rise in the next 12 months and four in 10 believed their firms would hire additional workers.
Both results were up from three months ago and suggested the respondents, often top executives at their companies, were more confident in the near-term prospects of their own firms than in the economy generally.
Douglas Baker, past chairman of the accountants’ group, said the executives were likely reacting to the onslaught of negative news about the global economy, whereas they know the position of their own companies better.
“A lot are much more bullish about their own companies than on the overall economy or the Canadian economy and that’s been the case the last couple of years,” he said.
“The executives are also people too and they watch the news and a lot of it is negative. But when they look at their own company, when they look at their order books, they say the projections look good.”
Baker said the accountants who participated in the survey are generally in senior executive positions at many of Canada’s largest companies.
A sampling of this size is judged accurate, plus or minus 5.6 percentage points, 19 times out of 20.
The higher confidence level is consistent with recent better results on surveys of businesses and consumers, but Baker noted that there is still plenty of pessimism to go around.
For instance, 44 per cent of the respondents thought an economic downturn will occur in the United States, down from 62 per cent three months ago but still a large number. And even on the Canadian economy, the majority — 57 per cent — were neutral about prospects.
“These numbers are not dramatically better, they are slightly better,” he said.