Home News Research and Markets Consumer confidence sags thanks to lingering pandemic

Consumer confidence sags thanks to lingering pandemic

MNP’s Consumer Debt Index recorded its lowest score since it started measuring in 2017

stressed young couple worries about their finances

The level of confidence Canadians have in their ability to manage debt has reached an all-time low, according to MNP’s most recent Consumer Debt Index.

As many continue to experience economic struggles due to Covid-19, the MNP Consumer Debt Index fell to 89 points, its lowest score since its June 2017 inception. It also experienced its sharpest quarterly decline, dropping five points since September, due to Canadians’ negative perceptions of their personal finances, household debt levels, and whether they could manage unexpected financial setbacks without incurring more debt.

“Almost one year into the coronavirus crisis, the financial confidence of Canadians has reached a low point,” said Grant Bazian, president of accounting firm MNP LLP. “The virus has understandably created significantly more financial anxiety for those directly impacted by job loss, declining wages, and business closures. The index shows that financial pressure is mounting for a large proportion of the country.”

The index revealed that 43% of Canadians fear they can’t cover their living expenses for the next year without taking on greater debt. Another 42% are concerned about their current debt level, and 45% regret the amount of debt they have taken on during the pandemic.

“When we see so many Canadians feeling like they can’t afford living expenses without taking on more debt, it signals that more financial upheaval may be on the horizon – particularly with so much uncertainty still ahead,” said Bazian.

Less than 30% of respondents are confident they can cope with life-changing events without taking on more debt, and only 25% believe they could stay above water if they lost their job or there was a change in their regular wages.

According to the survey, 28% of Canadians have taken on more debt due the pandemic, which includes the use of credit cards, lines of credit, borrowing from friends and family, and taking out various loans.

Ipsos surveyed a sample of 2,000 Canadians for MNP between Dec. 1 and Dec. 3, and weighted the results to reflect census data.

Latest news In Research and Markets

Wholesale and manufacturing sales climbed in March

Manufacturing sales hit their highest level since June 2019

U.S. retail sales were flat in April

The question is whether consumers will continue to spend without stimulus checks

Sustainable bond issuance set record in Q1: Moody’s

Interest in environmental and gender issues are driving growth in sustainable finance markets

Consumer insolvencies in March spike to highest level in a year

The increase reflected a return to pre-pandemic levels after a year of record lows

  • By: IE Staff
  • May 13, 2021 May 13, 2021
  • 11:38

Today's top stories

BRC firms and advisors roar back

Despite a tumultuous 2020, most firms received positive ratings from their advisors in this year’s Report Card

Help clients avoid TFSA overcontributions

Your clients may want to check their junk mail folder for correspondence from the CRA

Brokerage Report Card 2021 main chart

How investment advisors rated their firms

  • By: IE Staff
  • May 17, 2021 May 14, 2021
  • 00:11

Book sizes increase despite turbulent year

While AUM was up, overall productivity has declined from 2020