Canadians are pessimistic about their own personal finances and the economic outlook of the country this year, with 82 percent saying Canada is in recession, a new survey shows.
While Canada is not technically in recession, which is defined as two consecutive quarters in which the economy declines, the vast majority of Canadians believe it is and don’t expect 2024 to be any better.
Pollara Strategic Insights’ annual economic outlook found that 52 percent of those surveyed expect Canada’s economy to worsen in 2024 while 24 percent don’t expect the economy to change. Only 15 percent believe it will improve.
The latest survey “finds Canadians’ 2024 financial outlook among the most pessimistic Pollara has recorded over this poll’s 29-year history,” Pollara said in a news release. “This post-COVID economic malaise is being driven by the housing market and high interest rates.”
Forty-six percent of Canadians said they expect to fall behind financially in 2024, while only 8 percent expect to get ahead. Thirty-eight percent expect their financial situations to remain unchanged and the remaining 8 percent were unsure.
Food Prices
The price of groceries remains a worry for Canadians, with 46 percent of those surveyed rating it their number-one cost-of-living stressor.
In Alberta, 55 percent of survey respondents identified the cost of buying groceries as their top concern, followed by the Atlantic provinces at 53 percent, and Saskatchewan and Manitoba which sat at 46 percent. Ontario and British Columbia weren’t far behind with 44 percent and 41 percent of respondents respectively identifying food prices as a major worry. Quebec was the least worried, sitting at 39 percent.
Statistics Canada data released Jan. 3 showed that food prices have indeed remained high at supermarkets across the country. Of the 110 food items tracked through grocers’ check-outs, only 47 saw minimal price declines between Sept. 1 and Nov. 30. Of the 47 tracked items that decreased in cost, many had modest price drops like a one- or two-cent savings.
Fresh and frozen produce was the worst offender for price increases, according to the StatCan report, but staples such as milk, infant formula, butter, eggs, cheese, and bread also rose in price as did so-called bargain foods like pasta, cereal, and peanut butter.
Housing
The cost of housing was also high on the list of stressors for Canadians with 34 percent rating it as their top concern. Forty-three percent of respondents in Eastern Canada consider housing a concern compared to just 29 percent of Quebecers.Sixty-five percent of renters and 57 percent of mortgage holders were significantly more likely to say they are “worried” than homeowners with no mortgage, the survey found.
Younger Canadians were also more likely to be worried about housing costs than older respondents. Forty-five percent of those in the 18–34 age group identified housing as a major source of stress compared to just 19 percent of those over the age of 65.
As more people renew their mortgages at higher interest rates this spring, an increasing number of households are expected to feel the squeeze from rate hikes.
Numbers from an Angus Reid survey last fall revealed that 15 percent of mortgage holders found payments “very difficult.” And nearly 80 percent of those with a mortgage expect things to get worse when it comes time to renew. Angus Reid’s survey found that 40 percent were “worried” they would face higher payments after renewal, while 39 percent said they were “very worried” about higher payments.
Pollara surveyed 1,503 adults across the country between Dec. 6 and Dec. 11. According to Pollara, as a guideline, a probability sample of this size carries a margin of error of plus or minus 2.6 percent, 19 times out of 20.
