Market Update: Confidence in economy falls, but business self-confidence rises in Ontario – Full Analysis

The Ontario Chamber of Commerce says a majority of businesses are confident they can weather the current economic conditions.

The findings come from its latest Ontario Economic Report.

Through its survey of business owners, the report states that only 23% are confident about the economy, a 3% drop from a year ago.

It falls to 20% among small businesses.

Some of the issues impacting confidence include affordability, rising costs for operations, labour and housing, and trade and supply chain barriers.

Only 19% of firms report increasing their business investment in 2025, with 26% planning to increase spending this year.

In a recent presentation to the Empire Club of Canada, Chamber President Daniel Tisch says while businesses lack confidence in the economy, they have stronger confidence in their ability to weather conditions.

“A majority of them are confident in the prospects for their own business. And that is actually 3% higher than a year ago,” says Tisch.

“So while they’re not confident in the economy, they’re confident in themselves, in their resilience, in their ability to adapt and innovate and to grow.”

Some businesses have responded to the U.S. trade and tariff policies, with 25% increasing prices, 22% diversifying suppliers, and 20% willing to absorb the added costs.

The demand for labour is also showing signs of easing.

“Only 25 % of firms this year report having labour shortages, and that’s the lowest number we’ve seen in our report since the pandemic, although it is uneven across economic sectors and regions,” says Tisch

The report also finds that nearly 50% of firms have developed diversity and inclusion strategies, an increase of 7% from two years ago.

“And what that says to me is that Ontario businesses understand that diversity and inclusion is not about subverting merit, it is about enabling merit to be seen.”