A third of households say they are worse off financially than last year: survey

By Nojoud Al Mallees in Ottawa

A third of Canadian households say their financial situation has worsened in the past year, with families in lower income brackets more likely to say they are worse off, a new survey shows.

According to a Leger survey commissioned by the Association for Canadian Studies, 34 percent of Canadian households say they are worse off financially than they were last year.

The majority of respondents, 58 percent, said their financial situation is about the same as it was a year ago.

Nine percent stated that their financial situation had improved.

Jack Jedwab, president of the Association for Canadian Studies, said the most striking finding from the survey was the uneven challenges Canadians have faced over the past year, with those in lower income brackets feeling the biggest pinch.

Among Canadian households earning less than $40,000, 42 percent said their financial situation has deteriorated. That compares to 25 percent of households making $100,000 or more.

“People … in lower income brackets are finding the hardship particularly difficult in terms of the impact of inflation and higher interest rates and whatnot,” Jedwab said.

High inflation and rising interest rates have put pressure on Canadian finances over the last year. In a bid to curb rising prices, the Bank of Canada has aggressively hiked interest rates eight times in a row since March of last year.

Economists say low-income households are particularly vulnerable to inflation because they save less and have fewer buffers in the face of high inflation. That means higher prices put more strain on their budgets.

Meanwhile, higher earners are saving more and weathering the storm more easily.

The survey also found that Quebecers were the least likely to report that their financial situation had deteriorated, while respondents in British Columbia were the most likely to report that they were getting worse.

Among Quebecers, 22 percent said they were worse off. In British Columbia, the figure is almost twice as high, with 43 percent saying their financial situation has deteriorated.

Jedwab said the variety of responses across the country may have to do with the housing market and differences in house prices.

Tenants were also more likely than homeowners to report that their financial situation had deteriorated.

The online survey was completed by 1,554 Canadians between January 23 and 25 and cannot be subject to a margin of error because online surveys are not considered true random samples.

This report from The Canadian Press was first published on February 7, 2023.

Source: www.todayville.com