One in three Canadians say they are struggling financially due to the high cost of living, a level not seen since the start of the COVID-19 pandemic, a recent survey from the Angus Reid Institute finds.
The survey of 1,600 Canadians, released on Thursday, found that 34 per cent of Canadians are in “bad” or “terrible” shape financially, up six percentage points from last July.
By comparison, 27 per cent of Canadians reported being in bad or terrible shape financially in April 2020, when governments put in place lockdown measures to try to curb the spread of COVID-19.
“The fact that more describe themselves in bad shape financially now perhaps speaks to how challenging recent months have been for Canadians,” the survey from Angus Reid says.
The Bank of Canada held its key interest rate at 4.5 per cent in March after a year of increases to try to tackle inflation. The rate decision comes as the annual inflation rate remains high but continues to fall, reaching 5.2 per cent as of February.
However, food inflation has remained even higher at around 10 per cent year-over-year.
The Angus Reid survey found more than half of Canadians making less than $50,000 a year said they were in bad or terrible financial shape.
For about 18 months now, around half of Canadians have also said that feeding their households has been difficult.
Forty-five per cent of Canadians in March said it was either difficult of very difficult compared to 51 per cent in September 2022, 49 per cent in May 2022 and 45 per cent in October 2021.
MANY CANADIANS CUT SPENDING, PULL FROM SAVINGS
Sixty-seven per cent of Canadians say they reduced their discretionary spending due to the rising cost of living and as many as 40 per cent are withdrawing money from accounts they don’t normally touch.
Thirty-five per cent delayed contributions to their Registered Retirement Savings Plans and Tax-Free Savings Accounts and 13 per cent of respondents say they borrowed money from family or friends.
Forty-three per cent of Canadians are delaying a major purchase such as a home, car or major appliance, 11 per cent have sold an asset like a vehicle or stocks, and eight per cent have taken out a bank loan.
Although average hourly wages were up 5.4 per cent in February compared to a year ago, 45 per cent of Canadians surveyed said they have not received additional compensation from their employers in the previous 12 months.
This was higher among part-time workers at about 65 per cent compared to full-time workers at 42 per cent.
Workers in sales, retail and hospitality were the least likely to have gotten a raise, while managers and executives were the most likely to have received one.
FINANCIAL STRUGGLES VARY BY PROVINCE
Residents in Saskatchewan reported the highest financial struggles in the country, with 51 per cent saying they were in bad or terrible financial shape.
Atlantic Canada followed this at 45 per cent, including 20 per cent who said they were barely getting by – more than any other region in the country.
Forty-two per cent of Albertans and 36 per cent of B.C. residents said they were struggling financially.
The proportion of Manitobans saying they were struggling financially was slightly higher than the national average at 35 per cent.
Ontarians and Quebecers were the least likely to say they were struggling at 30 and 27 per cent respectively.
The Angus Reid Institute conducted an online survey from March 30 to 31, 2023, among a representative randomized sample of 1,600 Canadian adults who are members of Angus Reid Forum. For comparison purposes only, a probability sample of this size would carry a margin of error of plus or minus two percentage points, 19 times out of 20. Discrepancies in or between totals are due to rounding. The survey was self-commissioned and paid for by Angus Reid Institute.