Inflation anxiety: More Canadians say they’re worse off now financially than any time since 2010

Financial worry hammers low-income households as pandemic enters third year

January 21, 2022 @ 10:42 amIndependent Plus, Listowel Banner, News, Walkerton Herald-Times, Wingham Advance Times

Fifty-seven per cent of Canadians say it is difficult to feed their household in January 2022, compared to 36 per cent in April 2019 and 45 per cent in April 2016. Forty-one per cent say it is easy today, compared to 62 per cent in April 2019. (Angus Reid Institute image)

CANADA – A new study from the non-profit Angus Reid Institute (ARI) finds some Canadians struggling more than ever to endure the financial stresses of the pandemic, while others, secured by their relatively strong position of wealth, have seen their economic well-being maintained, if not improved.

Two-in-five (39 per cent) Canadians say they are worse off now than they were last year. This represents the largest group saying this in 13 years of tracking by ARI. This segment of the population is comprised largely of those who have lower incomes, more precarious housing situations, and difficulty keeping up with inflationary trends while relying on stagnant wages.

On the other end of the spectrum are higher-income, low-debt households, who have seen their position either unchanged over the past year or improved.

Notably, amid the highest level of inflation seen in 30 years, approaching three-in-five (57 per cent) Canadians say that it is currently difficult to feed their household. In 2019, when the Angus Reid Institute asked this same question, 36 per cent said this aspect of their finances was causing them difficulty.

As Canadians endure these challenges, many expect worse to come. One-quarter (23 per cent) of Canadians are optimistic that their financial standing will improve in the next 12 months, but more – 29 per cent – say it will worsen.

More key findings

  • Residents in Alberta (49 per cent), Saskatchewan (47 per cent), and Newfoundland and Labrador (47 per cent), are most likely to say they are worse off now than they were last year. At least one-in-three in every region say this, though that group is smallest in Quebec (33 per cent).
  • Four-in-five Canadians (82 per cent) say that the increase in cost of living has outpaced any income growth they have seen in their household.
  • Debt remains a major source of stress for one-quarter (24 per cent) of Canadians and a minor concern for two-in-five (42 per cent).
  • With many economists expecting a rate hike from the Bank of Canada sooner rather than later, one-quarter (25 per cent) of Canadians believe an increase in interest rates would have a major negative impact on their household finances.