Canadians feel better off today than before the recession

A recent report examined Canadian's behaviour and outlook post-recession, and when it comes to what determines their financial outlook, the vast majority of Canadians put their eggs in one basket: real estate.

According to advertising agency Bensimon Byrne's latest Consumerology Report, Canadians are still coping with the effects of the recession yet are feeling optimistic about their personal finances. When asked about their personal financial situation now compared to pre-recession 49% report their living expenses have increased, only 31% are earning more money, and only 22% report say their investments have increased. Despite these figures, more than half (58%) say their personal finances are better today than they were before the recession and the vast majority (81%) indicate they expect to be doing even better one year from now.

The findings point to an obvious question: what's driving this post-recession optimism? And the answer appears to be the Canadian housing market; with the majority of Canadians (58%) saying their house or condo is worth more than pre-recession.

Each quarter, the Consumerology Report tracks consumer opinions about the economy, individual financial expectations, consumer spending intentions, and attitudes toward key national issues. The purpose of this edition was to understand the consumer financial situation, post-recession attitudes and behaviours, and consumer economic outlook.

Beyond the overall optimism Canadians are feeling about the economy, the report also revealed Canadians are feeling the financial squeeze from rising grocery and gas prices, along with increased taxes and utility costs. Canadians are also focused on reducing their debt and building a savings safety net - a reality that will cause many consumers to cut back on discretionary expenditures, especially those related to entertainment.

The report also finds that even so-called essentials are not 'recession proof'. During the recession, even items like groceries and gas experienced a decline. The categories hit hardest were vacations, clothes, eating out, and fitness. Now, these areas are starting to rebound but bars and live sporting events are still victims of the recession with people reluctant to open their wallets for those activities.

Additional survey highlights

• More than half of Canadians are doing better today than they were doing a year ago and better than they were pre-recession.
• More than half (59%) say the Canadian economy is in a period of growth.
• More than three quarters (77%) of Canadians think a year from now the economy will be stronger.
• When looking at financial factors in their life, people feel most positive about the value of their home (73%) and least positive about their retirement income (35%).
• The cost of healthcare/medications, mortgage/rent, and cable/satellite TV are household budget pressures for a clear majority of Canadians.
• Lower income Canadians are particularly stressed by two essentials - food costs and medical/prescription drug costs.

This quarter's survey was conducted in English and French by The Gandalf Group amongst 1,500 Canadians.

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