Canada’s services sector took a sharp dip in November, shrinking at the fastest pace since June, according to new data from S&P Global. Economic uncertainty across the country led to fewer new clients, less business activity, and even job reductions.
The main Business Activity Index dropped to 44.3, down from 50.5 in October—well below the 50 mark that separates growth from decline.
Paul Smith, economics director at S&P Global Market Intelligence, said the latest results paint a “sobering” picture as we approach the end of 2025. He explained that many companies are seeing a slowdown in new work because clients are hesitant to commit while the economic outlook remains uncertain.
New business fell again, sliding to 45.0, and employment numbers hit 47.1, the lowest since mid-2020.
With roughly 75% of Canadian exports going to the U.S., the ongoing trade tensions—largely driven by American tariffs—continue to put pressure on Canadian businesses. Higher costs are still a challenge, too, especially wages and tariff-related expenses, but many firms say they can’t raise prices without losing customers.
Input prices eased slightly to 60.1 from 61.0, while the prices companies charge slipped to a seven-month low of 50.6.
The overall Composite PMI, which measures both services and manufacturing, also dropped—falling to 44.9, the weakest reading since June. Just earlier this week, data showed the manufacturing sector is also contracting more quickly due to trade uncertainty holding back production and new orders.
(Source: Reuters News)
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