Businesses Planning to Shrink their Workforce

There are a lot of different ways to measure business confidence, and the picture is a bit muddled right now, depending on which metric you look at. One number that stood out in the Bank of Canada Business Outlook Survey this week is the share of businesses who are planning on cutting the size of their workforce.

It’s not that business sentiment is catastrophically bad right now. But taken together it looks like companies are hunkering down, and trying to ride out uncertainty.

Canada didn’t experience a recession in 2025, but with companies downsizing and holding off on new investment, the economy can feel tough even if it’s not technically shrinking.