While most Canadians believe the recession is over, many are sticking with frugal spending habits, says a report by Toronto advertising firm Bensimon Byrne.
The result of a national survey of 1,500 Canadians, the results show that Canadians are feeling increased optimism about the economy, but large personal debt will severely limit their ability to return to pre-recession spending levels, said firm president Jack Bensimon.
“The culture of thrift and frugality that developed during the recession persists among Canadians of all income levels,” he said.
More than half of Canadians say they are better off than they were a year ago and more than 80 per cent think the economy and their own situation will be even better a year from now, he said.
However, more than half of Canadians believe they will have to delay retirement due to their financial situation and 40 per cent of parents are adjusting their education plans for their children. The study found that more than one-third of Canadians are so loaded with non-mortgage debt that it will take three years or more to pay it down and more than 60 per cent of Canadians would put extra spending money into paying down debt rather than investing, saving or making a major purchase.
About 92 per cent of Canadians are considering “need” over “want” when it comes to spending. Canadians are increasingly opting for no-name products over brand names and bargain hunting over impulse purchasing, Bensimon said.
Most Canadians report that their spending remains much lower than it was a few years ago, Bensimon said.
Sixty per cent of Canadians are behind where they thought they would be financially at this point in their life and are much more likely to think their standard of living will be lower rather than higher post-recession, Bensimon said. Few Canadians have confidence that they will ever be more prosperous than they are now and fewer than one in five are relatively confident the next generation of Canadians will have a better quality of life.
Last year’s recession appeared to have no impact Albertans’ spending levels at restaurants and drinking establishments.
Total restaurant and drinking receipts were essentially unchanged (up 0.2 per cent) in 2009 while overall retail sales in the province fell more than 10 per cent, according to Statistics Canada data released Monday.
“With active lifestyles and busy schedules, it could just be that eating in restaurants is no longer a luxury for many Albertans. Now, dining out is non-discretionary,” wrote ATB Financial senior economist Todd Hirsch in his daily economic comment.
The data suggest that restaurants and bars may be somewhat immune to downturns, Hirsch said.
In January of this year, Albertans spent $556.7 million on restaurant meals and beverages, up 1.2 per cent from the same month last year.
