Review of Economic Statistics — March 22, 2019 - Transcript
(The Statistics Canada symbol and Canada wordmark appear on screen with the title: "Review of Economic Statistics — March 22, 2019")
(Background music plays while title card with the text "Review of Economic Statistics" appears on screen.)
Richard Evans: Welcome to the Review of Economic Statistics. I'm Richard Evans.
Elizabeth Richards: And I'm Elizabeth Richards.
(Text on screen below presenters: "Richard Evans, Director General, Industry Statistics. Elizabeth Richards, Senior Economist.")
Richard Evans: Elizabeth, it's that time of the year where I'm gathering all my personal information and getting ready to do my tax returns. It's got me thinking about wealth and net debt and that sort of thing, and what better time than now to look at the fourth quarter household balance sheet report. What stood out in that report?
Elizabeth Richards: One important measure of economic well-being for Canadians is net worth, so total household assets minus liabilities. Net worth declined 2.8% in the fourth quarter.
(Text on screen below presenters: "Household net worth declined 2.8% in the fourth quarter.")
Richard Evans: What were the main contributing factors to that?
Elizabeth Richards: Household assets were down mainly on financial assets. We saw weaker stock markets in both domestic and foreign markets, especially towards the end of the fourth quarter. Residential real estate continued to decline, also contributing to lower assets, and I do want to flag that on an annual basis, residential real estate declined for the first time since the start of the series.
Richard Evans: Okay, so fourth quarter assets down on weaker real estate markets and weaker stock markets. What about the liabilities side?
Elizabeth Richards: Household liabilities were up and increased at a slightly faster pace than incomes. As a result, if we look at credit market debt, which includes mortgage loans and non-mortgage loans relative to disposable income, the ratio reached 179%. What that means for Canadians is that for every dollar of disposable income, they owed $1.79 in credit market debt in the fourth quarter. I do want to highlight on an annual basis that household credit market debt was down almost 20%, reaching levels similar to what we observed in 2014.
(Text on screen below presenters: "Households owed $1.79 in credit market debt for every $1 of disposable income in the fourth quarter.")
Richard Evans: Okay, so on those balance sheets, assets down and liabilities up, a decline in wealth.
Elizabeth Richards: That's right.
Richard Evans: Let's look at manufacturing now. The manufacturing report is out for January. What did that show? What were the highlights there?
Elizabeth Richards: So following three consecutive declines for manufacturing sales, sales were up 1%. There were widespread gains in food and electrical equipment and in volume terms, sales were up even more, so by 1.4%. I do want to highlight that though this was a partial sales recovery, sales were similar to levels observed in late 2018.
(Text on screen below presenters: "Following three consecutive declines, manufacturing sales rose 1.0% in January.")
Richard Evans: Great roundup, thank you very much. Thanks for joining us, see you next time!
(Text on screen below presenters: "www.statcan.gc.ca")
(Background music plays while title card with the text "Review of Economic Statistics — March 22, 2019" appears on screen.)
(Canada wordmark appears.)