Although Canada has a robust economy, many of us aren’t profiting from the harmonious and recurrent gains the nation has made in GDP growth. Data released from Statistics Canada in 2019 showed average incomes increased by 2.8 per cent over two years, but the incomes for those at the top climbed by 5 per cent.
The top 10 per cent in Canada captured a quarter of the country’s economic growth, while the bottom 40 per cent raked in one-fifth of the capital harvested from this nation’s profitable advances. Since the 1980s, the majority of Canadian incomes either stagnated or dropped significantly, while the top 1 per cent and 0.1 per cent of earners had seen their earnings flourish at astonishing levels. Consequently, a majority in this country are receiving poverty wages and dwelling in clouds of impenetrable debt, as a minority continue to gain in wealth.
Craig Alexander – senior economist with Deloitte Canada – told PressProgress a principle motivation for Canada’s sluggish income growth for average employees was represented by the slimming wage packets collected by the nation’s earners. “A tight labour market should allow wages to rise, but we aren’t seeing much wage growth,” Alexander surmised, proving wage-stagnation is truly a factor in this country.
In the weeks after the Christmas holidays, many of us have started to receive frightening credit card statements and bills, reminding us of our tremendous debt loads which have refused to ease. Most Canadians are treading water in economic terms. In the Credit Canada SADD Index, an Angus Reid poll of 1,502 Canadians asked the respondents how they anticipated on either saving or spending for the next three months leading into the spring of 2020. The survey also asked the interviewees about how they would personally describe their financial circumstances. Most responders maintained a ho hum attitude with 59 per cent of participants saying their situations remained the same, while 29 per cent said their finances were improving, but 12 per cent said their personal economics were systematically deteriorating.
The Credit Canada survey quizzed the participants on how they intended to save money this winter. One-in-five Canadians, or 18 per cent of those surveyed, said they’d hibernate and stay inside until the thaw arrived. Several respondents (39 per cent) said they’d introduce cuts to their entertainment budgets by hanging at home and watching Netflix. Travelling was no longer an option for 37 per cent of the survey’s contributors, who wanted to have staycations instead of flying off to Florida, Mexico or Hawaii to escape the winter. Plans to slash grocery and restaurant bills were also contemplated, with 44 per cent of those surveyed reporting they’d eat more budget-friendly dishes. Almost half of those surveyed, or 42 per cent of respondents, were deliberating on keeping the heating and lighting low at home to save money. Thirteen per cent of the survey’s applicants said they weren’t drinking for the months of January and February to ease their budgets.
According to Statistics Canada, the number of those living below the poverty line declined from 10.6 per cent in 2016 to 9.5 per cent in 2017. However, the debt load for Canadians has consistently increased. Figures released by Equifax in June 2019 revealed the median debt for Canadian consumers extended to $71,300 in the first quarter of 2019, representing an escalation of 2.6 per cent since June 2018. Alarmingly, total consumer debt including mortgages had enlarged to $1.907 trillion in 2019 from $1.823 trillion in 2018. Non mortgage-related debt had also swollen by 4.9 per cent in comparison to 2018’s figures. Equifax further stated Canadian consumers were paying their balances much slower on automobile and bank loans than previously. So, an increase in debt coupled with continual wage stagnation could mean the nation’s economy is poised to rupture like a soap bubble in the near future.
