Eight in 10 Ontarians believe Canada is in recession and nearly half expect to be left behind financially by 2024: survey

Most people in Ontario don’t have high hopes for Canada’s economy in 2024, according to a new survey which also shows that the respondents also do not feel good about their personal finances.

“The negativity persists,” said Dan Arnold, chief strategy officer at Pollara Strategic Insights, which conducted the online survey in December.

Driven by the “post-COVID economic malaise,” high interest rates and inflation, 83 per cent of Ontarians surveyed feel the county is in recession and only 10 per cent feel the country is in a period of growth.

Although Canada is not currently in a technical recession, which economists define as two consecutive quarters of negative growth, the numbers show Ontarians are feeling the pressure.

“People don’t expect things to get better next year. And Canadians look to the future with the expectation that we will be in a period of high inflation and high economic turbulence for a while,” Arnold said.

Research also shows that Ontarians are not optimistic about their personal finances in the next 12 months.

At least 46 per cent of all Ontarians surveyed feel they will be left behind financially in 2024, while only eight per cent believe they will be able to keep pace with rising prices.

According to Pollara, Canadians’ financial outlook for 2024 is among the most pessimistic the company has seen in its 29 years of conducting the survey.

The last time confidence levels in the national economy were this low, Arnold said, was after the 2008 recession.

“Even then, after a year, people still weren’t feeling very well, but at least things were getting better. And two years later, according to the 2011 survey, we returned to normal figures across the board,” he explained.

Additionally, the survey shows a number of “pressure points” that are impacting Canadians’ wallets by region.

In Ontario, the cost of food and groceries is causing stress for 44 percent of respondents. Housing expenses are a concern for 36 percent of respondents, as is the cost of gas at 27 percent.

WOULD LOWER INTEREST RATES BOOST THE ECONOMIC SPIRIT?

Right now, Canada’s inflation rate is 3.1 per cent and its key interest rate is set at 5 per cent. If any of those numbers fall in 2024, that could mean a big morale boost for Canadians and their economic hopes for the new year, Arnold said.

“The combination of: high housing prices and high interest rates. That’s having an impact right now. I think if interest rates were to go down, at least for people who are renewing their mortgage in the near future or who have a variable rate mortgage, that would certainly decrease their financial anxiety to a great extent,” Arnold said.

To that end, a decrease in gasoline prices, food or housing expenses would also go a long way toward reducing the stress of cost-of-living pressures, he said.

“Which should make them feel better overall about the economy and their personal financial situation.”

METHODOLOGY

Pollara conducted an online survey of a randomly selected sample of 1,503 Canadian adults from December 6 to 11, 2023. The margin of error is +/- 2.6 percent, 19 out of 20 times, and the data has been weighted according to gender. Population data by age and region from the last Canadian census.


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