Small business confidence rises as uncertainty looms in 2026

Small business confidence reached its highest point at the end of 2025, according to a report by the Canadian Federation of Independent Business (CFIB). But this comes as uncertainty about the new year persists.

The CFIB’s Business Barometer, which measures long-term confidence, sat at nearly 60 out of 100 in December, a dramatic increase from 25 back in March when it reached its lowest level ever — lower than the pandemic or 9/11.

“We have a U.S. supplier that sent us a letter trying to explain what they are intending to do about the China tariffs,” said Donette Hyslip, co-owner of Action Hobby.

CityNews spoke with Action Hobby last April, when the store had to make sense of not only an escalating trade war between the U.S. and Canada, but also one that involved the States and China, a country where many of the store’s products originate.

The fear, as prices go up is their customers would dramatically go down.

“We are the last ones on our customers budgets for where their money goes,” said Hyslip.

But at the start of 2026 they’re still going strong.

“We’ve still been getting lots of customers, we still get customers who are special ordering stuff from us, which has been nice,” said Kiara Foisy, Action Hobby manager. “Even with a lot of people where they have noticed the increase on something they’ve ordered, they’re still fine with taking it.”

The CFIB says that its December numbers could have been helped by optimism heading into this past holiday season.

With businesses now focused on the new year, they are calling on the provincial government to lower the small business tax rate to provide some relief.

“I think there’s a lot of uncertainty around the re-negotiation of CUSMA,” Kayode Southwood, a senior policy analyst with CFIB. “Businesses are really looking at that coming in the summer to see what that outlook might be for their businesses depending on how that goes. I think there’s still a lot of uncertainty around consumer spending.”

“The biggest uncertainty was whether or not the tariffs would affect us majorly this year,” Foisy said. “Haven’t seen it yet, but we are just one, two weeks into the new year.”

At least for now, Action Hobby is hoping that in 2026 the only thing in the air are their RC planes and not trade policy.

“More than anything I’m just happy to see people staying in the hobby, willing to support the little shops to do it. It makes everyone happy at that point,” Foisy said.