According to a report in Monday’s Globe and Mail, Canadian consumers worried about paying down debt are tightening their belts as their American counterparts are moving in the opposite direction.
The paper cited new global research from Boston Consulting Group, which shows more and more Canadians are adopting the frugal shopping habits they learned in the recession, such as bargain hunting and buying fewer non-essentials, even though they feel relatively optimistic about the economy’s future. Americans, on the other side of the coin, feel more confident about spending than they did two years ago, even though they’re more pessimistic than Canadian consumers.
The Globe and Mail writes the reason for the divergence is that “many Canadians are still feeling financially strained as policy makers, including Bank of Canada Governor Mark Carney, warn against the dangers of taking on too much debt. Americans, in contrast, began saving during the economic meltdown and now feel less stressed than in 2009. These shifting trends are reverberating with retailers. While consumers on both sides of the border are watching their spending as food and gas prices soar, Canadians in many instances are scaling back even more.”
The new data shows the diverging trends in the two countries since the downturn: a 6% increase among Canadians who say they plan to shave their spending on non-essentials in the next year – to 63% of respondents – compared with a 19% drop among Americans who will do so – to 62% of respondents.
Among consumers shopping around for more bargains, the survey shows a 10% jump among Canadians who say they plan to do so – to 69% of respondents – compared with a 4% decline among Americans who plan on doing the same – to 67%. The research also shows that 77% of Canadian women say they’ll defer major expenses compared with just 62% of men.
To view the complete article in The Globe and Mail, click here.
