‘Bracing for impact’ in 2025

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This article was published 26/03/2025 (221 days ago), so information in it may no longer be current.

A significant proportion of Manitoba businesses are expecting the worst in 2025, and increased operating costs and U.S. tariffs are their biggest concerns.

That’s according to Probe Research’s annual Manitoba Business Leaders Index. The survey shows that 31 per cent of business leaders expect to do worse in the coming year — more than twice the proportion that said the same in early 2024 and more than double the respondents that expressed it in March 2021, one year into the COVID-19 pandemic.

While higher costs remain businesses’ top concern (57 per cent), more than one third (35 per cent) indicated U.S. tariffs are the issue they worry about most.

“None of it is really a huge surprise,” said Curtis Brown, a principal with Probe Research. “Businesses are bracing for impact; they’re bracing pretty hard, it looks like.

“When you have a huge jump in the people who say things won’t be as well-off next year, that shows you the confidence of businesses now is shaky given everything going on economically and politically.”

The vast majority of business leaders (78 per cent) expect tariffs to hurt, but to be worse on a broader scale — 95 per cent agreed they will have a negative impact on the provincial economy.

Businesses are most likely to have postponed investments or delayed hiring in response to these tariffs, with only a small number noting they are moving or might move production to the U.S. (11 per cent). More than eight in 10 also agree Donald Trump’s U.S. presidency will have a negative effect on the Canadian economy.

“I think it’s pretty clear what’s on the minds of businesses and it’s Trump, Trump and Trump,” said Chuck Davidson, president and CEO of Manitoba Chambers of Commerce. “Until we’ve got more certainty on what the impact of tariffs will be on businesses, there will be this sense of not knowing what the future holds for them.”

When it comes to the faith businesses have in governments to deal with Trump’s administration, 50 per cent are confident in Manitoba Premier Wab Kinew and his NDP government’s response to U.S. tariffs.

Nearly half (47 per cent) of businesses expressed confidence in a potential federal government led by Pierre Poilievre and the Conservative Party and 35 per cent said they are confident in the current Liberal federal government. (The survey was conducted prior to Justin Trudeau stepping down and Mark Carney being sworn in as prime minister.)

When it comes to views on creating a positive climate for business, nearly three in 10 now indicate the provincial government does an excellent job in this regard (28 per cent, from 22 per cent 2024), while one-quarter say the same about their local government (26 per cent, down two points) or the federal government (20 per cent, up from 14 per cent last year).

Brown said he found respondents’ views on government performance interesting. Typically, the provincial business community tends to be happier when a Progressive Conservative government is in power as opposed to when the NDP is in power.

“Business leaders seem to think Wab Kinew and the NDP are doing a good job with the tariff issue,” he said. “I think that’s evidence of the NDP’s popularity overall, which you see in some of our other polling.”

Meanwhile, demand for workers is soft but there is still high demand for employees with the right skills. Last year, nearly six in 10 employers (58 per cent) reported having a hard time finding qualified employees; that number stayed the same this year.

Fewer than one in five (17 per cent) expect to hire more employees in the coming year, which is the lowest level recorded in the past decade. More than one in 10 (12 per cent) expect to have fewer staff at this time next year.

According to the survey, 44 per cent of Winnipeg businesses are optimistic about the city’s economy, which is relatively consistent with 2023 (48 per cent) and 2024 (45 per cent). Rural and northern businesses expressed a similar level of confidence about their own communities, with 45 per cent reporting that they are optimistic.

The survey findings closely reflect what Economic Development Winnipeg has been hearing in recent roundtable discussions with the city’s business community, according to Ryan Kuffner, president and CEO.

“Businesses are practical and focused on what they can control, which includes calling for all levels of government to support competitiveness through process improvements, reducing unnecessary red tape, addressing barriers like interprovincial trade restrictions and providing targeted financial supports,” he told the Free Press in a written statement.

Kuffner called on businesses to work together.

“Our diverse economy, strong talent pool and collaborative spirit remain key strengths that will help us navigate uncertainty together,” he said. “But this is also a clear moment to invest in our competitiveness and we should seize it — as a community.”

Probe Research surveyed 200 owners and managers throughout Manitoba between Feb. 4 and March 12. The survey has an expected margin of error plus or minus 6.9 per cent.

aaron.epp@freepress.mb.ca