Study: Expected changes in spending habits during the recovery period
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Released: 2020-07-22
Around mid-June, physical distancing measures began easing across the country, giving Canadians more opportunities to spend money. However, COVID-19 is still with us, shopping habits have changed and there are 1.8 million fewer employed Canadians now than there were prior to the pandemic.
How our economy evolves going forward will largely depend upon the spending choices Canadians make over the coming weeks and months. The study "Expected changes in spending habits during the recovery period," based on results from a recent web panel survey conducted in June, looks at how spending habits may change.
Canadians plan to reduce discretionary spending
Canadians were less likely to signal a change to spending on more essential items. For example, 87% of respondents reported that they would spend the same on housing, compared with 8% who said that they would spend more and 5% who said that they would spend less.
In general, respondents planned to spend less rather than more on some discretionary items. For example, half of the respondents to the panel survey said that they planned to spend less money eating at a restaurant. Additionally, about one-third planned to spend less on entertainment, clothing or apparel, recreation, or ordering take-out food.
Conversely, while most respondents said that they expected to spend about the same on groceries, almost one-fifth (19%) expected to spend more, while 10% said that they would spend less.
Expected changes in spending habits are related to financial conditions and health concerns
Financial conditions are related to expected changes in spending habits. Among people who reported that their income was not sufficient to meet their household expenses, 52% reported that they would spend less on clothing or apparel, and 46% said that they would spend less on recreation. At the same time, those who faced financial difficulties were more likely to report that they expected to spend more on essential items, such as housing.
Health concerns also played an important role in expected spending, particularly discretionary items such as eating at a restaurant. For example, among those who reported that they were very concerned about the health risks of going to restaurants and bars, 67% said that they would spend less on eating at a restaurant, compared with 29% among those who reported that they were not at all concerned.
Expected changes in spending habits vary across population groups
Canadians aged 15 to 34 were more likely than those aged 35 and older to expect to spend more on recreation and entertainment. Higher expected spending on recreation and entertainment among younger people might reflect a higher degree of pent-up demand among this age group and an expectation that the job market will improve with the reopening of the economy. It might also reflect the fact that younger people were less likely than older people to express concerns about the health risks of reopening the economy.
Immigrants were generally more likely than Canadian-born individuals to report that they would spend less on a number of items. Specifically, immigrants were more likely than Canadian-born individuals to expect to spend less on eating at a restaurant (63% versus 48%), transportation (39% versus 25%), recreation (43% versus 29%), saving and investing (29% versus 15%), and clothing or apparel (42% versus 30%). These results reflect earlier findings that showed that immigrants were more likely to report being financially impacted by the pandemic.
Note to readers
The data from this release are from Statistics Canada's new Canadian Perspectives Survey Series (CPSS). The CPSS surveys are web panel surveys that were developed by Statistics Canada to get timely information about how Canadians are coping with COVID-19. For this survey series, the same respondents are surveyed on a regular basis to get a sense of how they are doing in the context of the pandemic. In the most recent iteration of the CPSS (the third since the beginning of the pandemic), more than 4,000 respondents answered a number of questions from June 15 to 21, 2020, on resuming social and economic activities.
Products
The study "Expected changes in spending habits during the recovery period" is now available as part of the series StatCan COVID-19: Data to Insights for a Better Canada (45280001).
Contact information
For more information, or to enquire about the concepts, methods or data quality of this release, contact us (toll-free 1-800-263-1136; 514-283-8300; STATCAN.infostats-infostats.STATCAN@canada.ca) or Media Relations (613-951-4636; STATCAN.mediahotline-ligneinfomedias.STATCAN@canada.ca).
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