The latest MNP Consumer Debt Index compiled by Ipsos in early March shows Canadians are more worried about their consumer debt than ever before. Almost half (46%) say that they are concerned about their current debt levels, a whopping 10-point jump from the previous wave in December and the highest percentage ever recorded since tracking began.
The most troubling point is that this latest data was compiled by Ipsos on behalf of MNP LTD between March 2 and March 5, 2020. This was a good 10 days before Canadians were forced to begin cloistering indoors, the new term “social distancing” became woke, a large portion of the economy was basically put on ice, and 1.55 million Canadians (and counting) joined the unemployment rolls between March 16 and March 25. The lucky ones (so far) have been placed on forced vacation or hastily coordinated to remote work arrangements in an effort to keep business limping along. Will this massive moving of this slice of the workforce to remote work arrangements prove to be productive enough to justify being maintained as long as conditions remain as is, or will this simply prove to be a feeble attempt to ‘kick the can down the road’ a bit? We as a society have become quite adept at this over the last decade or two as a policy response to any challenge. Will we be facing another seven-figure wave joining the unemployment roles sooner rather than later? Clearly, if we’ve learned one thing over the last 30 days it is that “anything is possible”.
According to the report about half (49%, -1pt) of Canadians are teetering on the brink of insolvency, indicating they are $200 or less away from not being able to pay all their bills each month. This includes one quarter (25%) who say they are already unable to meet all their monthly debt obligations.
Irrespective of the generosity of support programs being made available by both the Federal and various provincial governments, (in other words by us, the taxpayers) to help Canadians bridge the gap, we cannot imagine the next quarterly report revealing anything but greater deterioration in the numbers.