Canadian consumer outlook improves in February: survey

March 1, 2010
Financial Post
Written by: Julie Fortier

OTTAWA -- Canadian consumers were more positive about the economy in February, according to RBC's latest Canadian Consumer Outlook Index, which rose to 109 from 106 in January.

According to RBC, 53% of consumers when asked about their outlook for the overall economy in February said it was good while 47% described it as bad. That was an improvement on January when 52% described the outlook for Canadian economy as bad and 48% described it as good.

Also, 25% of consumers who took part in the latest survey said a member of their household is worried about losing a job or being laid off, down slightly from 26% in January. The highest level of job anxiety was in Ontario, which was up five percentage points to 30%, and in Atlantic Canada, which was up six points to 24%.

"We know that 21% of Canadians are planning ‘staycations' this month, primarily for financial reasons. The continuing high levels of concern about job loss are likely a factor in those financial reasons," said David McKay, group head of Canadian Banking at RBC.

Also, the percentage of Canadians who think that their personal financial situation will improve in the next three months fell to 30% in February from 32% the month before.

But Canadians remain optimistic in the longer term, according to the report, with 45% saying they expect their personal economic situation to improve over the next year -- unchanged from January. Also, 62% said they expect the national economy to improve over the next year -- up from 56% in January.

Last month, the Conference Board of Canada's index of consumer confidence also showed that Canadians were more positive about the future, with particularly strong responses on future employment opportunities.

"Canadians may be feeling more positive about the economy because job growth numbers were released in early February. We expect to see a sustained improvement in the labour market over the course of the year," said Robert Hogue, senior economist at RBC.

Employment in Canada increased by 43,000 in January -- all in part-time jobs -- pushing the unemployment rate down to 8.3%t, according to Statistics Canada data released last month. However, employment still remains 280,000 below the peak level of October 2008.

The RBC's online survey, based on the answers from 1,064 Canadian adults, was conducted by Ipsos Reid between Feb. 9 and 12, 2010. Results are benchmarked to November 2009.

Canwest News Service