Consumer confidence steady in January, says Conference Board
Ottawa, ON -- The Index of Consumer Confidence held relatively steady in January 2009, edging up 2.5 points to 70.2...
Ottawa, ON — The Index of Consumer Confidence held relatively steady in January 2009, edging up 2.5 points to 70.2 (2002 = 100), according to the Conference Board of Canada. Despite the slight increase, the index remains at levels consistent with those seen during other times of economic recession in Canada.
Although consumers continue to expect unfavourable employment conditions in their communities six months from now, they did indicate that they believed their financial situation was beginning to improve. Moreover, for the fourth consecutive month, a greater number of respondents said now was a good time to make a major purchase.
Results across the country largely pointed in the same direction. Quebec and Atlantic Canada were the best performers, with indexes advancing 4.3 and 4.1 percentage points respectively. There were smaller gains in Ontario and British Columbia. The Prairies were the lone region to register a decrease, with the index there falling 1.8 points.
As gasoline prices across the country continued to fall, respondents indicated that they were slightly more optimistic about their current financial situation. When asked if their families were better off today than six months ago, 13.3% said they were — up 0.8 percentage points from the previous month. There was also a 1.7-point drop (to 24.8%) in the proportion of people who said their financial situation had deteriorated. Still, nearly 60% of respondents said their financial situation had not changed in the past six months. That indicates that the majority of respondents believe they have been largely unaffected by the economic turmoil in Canada.
Relative to December 2008, responses on the survey’s future financial conditions question also improved. When respondents were asked if they thought their family’s financial situation would improve over the next six months, 22.2% said that it would — an increase of 0.8 percentage points. The share of respondents who believed they would be worse off also fell — down 2.1 percentage points. Still, 51% of respondents indicated that they believed their financial situation had levelled off and would be the same six months from now.
The balance of opinion on future employment conditions remains negative, with no improvement at all in January. The proportion of people who believed there would be more jobs opportunities in their communities six months from now increased 0.4 points to 7.6%. Unfortunately, the share of respondents who felt that there would be fewer jobs six months from now also increased 0.4 points, to 50.9%. The responses indicate that the majority of people remain concerned about the health of the Canadian employment market.
For the fourth survey in a row, results on the major purchases question improved. Respondents are asked if now is a good time to make a major purchase, such as a home, car, or other major item. In January, 28.5% of consumers thought that it was, up 1.8 percentage points from December. There was also a 4.3 percentage point drop — to 59.2% — in the share of people who thought that now was a bad time to make a major purchase. Still the balance of opinion on whether now is the time to make a major purchase remains negative.
Regionally, results were largely headed in the same direction, with four of the five regions showing improvements. After recording the largest drop of any region in December, Atlantic Canada was up 4.1 percentage points to 75.4%. Both Quebec and Ontario registered significant gains. Quebec was up 4.3 points to 68.7%, while Ontario rose 3 points to 65.4%. British Columbia realized a smaller gain of 2.3 percentage points but — at 79.4% — still leads the country.
The Prairies were the lone region to record a decrease (-1.8%) in January; however, at 75%, the index there remains well above the national average.
The survey was conducted from January 8 to January 16, 2009. The margin of error is plus or minus 2.19%, 19 times out of 20.
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