A concerning number of Canadians are struggling to make ends meet, with risks of defaulting on their mortgage, declaring bankruptcy, and affording basic necessities, according to a new poll published by Maru Public Opinion.
The March 2024 Canadian Maru Household Index showed that in the next 60 days, 18% of respondents will default on making payments on major loans or a mortgage. This is tied with the highest level ever, September 2023, since tracking began in July 2020.
An Equifax Canada report from March 5 shows that mortgage delinquency rates have increased 52.3% in the last year. Ontario and British Columbia are the largest drivers of this increase at 135.2% and 62.2%, respectively.
The number of Canadians who will struggle to make ends meet has improved since February. 39% said they will struggle to make ends meet in the next two months.
Between February and March, the number of people worried about their personal or family day-to-day finances remained unchanged, at 55%.
10% of Canadians said they will not have enough food for themselves or their family in the next 60 days. 11% will likely declare bankruptcy — the highest level since June last year.
Fewer people believe that the national economy will improve than those that do, 40% compared to 60%, an improvement of 1% since February.
“Last month’s metaphor that consumer confidence was hanging by a thread is still apt, but its reprieve has been primarily because Canadians have an underlying belief (or hope) that the national economy will improve,” reads the report.
The opinions of Canadians’ thoughts on the direction of the economy have slightly improved since last month. 36% thought that the state of the economy was moving in the right direction, versus 64% that said it was on the wrong track.
When focusing on their personal financial situation, only 12% of respondents feel that it has improved since last month. 23% say that it has worsened, while the remaining 65% say that it has remained the same.
With regard to housing, 23% of respondents will not be able to afford to keep a roof over their own or their family’s head in the next 60 days.
Maru collected data from a random selection of 1,532 Canadian adults who are online panellists between March 1 and 4.
The Bank of Canada rate held steady at 5% for the fifth consecutive time despite expectations from economists that the central bank would lower interest.
Following the announcement, Finance Minister Chrystia Freeland met with business leaders for a “consultation meeting” before her federal budget on April 16, 2024.
Maru’s report explained that the meeting’s media release failed to mention the estimated $46.8 billion deficit, up from $35.3 billion in the last year.
“Nor did it address the impact of Ottawa’s immigration policy on real prices and mortgage interest costs (rising by a record 28.5% in 2023), higher carbon taxes, and other government induced measures that are fueling the very inflation that the BOC is trying to bring down,” said the report. “At the same time, the BOC didn’t address the highest interest rates Canadians are experiencing in twenty-two years that are just pouring more fuel on the cost-of-living fire.”
The March 2024 report shows the Maru Household Outlook Index to be at 87, up one point from February and reaching its highest level since May 2023.
The index measures Canadians’ outlook on the economy and their personal finances. With 100 being neutrality, anything beneath it signifies a negative outlook of the economy. Canada has been stuck in the red since December 2021, reaching its lowest point of 83 in March 2023.
