Ottawa, ON – The Conference Board of Canada’s Index of Consumer Confidence posted a 6.5-point drop in December 2011, bringing 2011 to a disappointing close. At 69.9 (2002 = 100), the index is down 11.1 points from where it was at the end of 2010, and confidence is now at its lowest level in more than two-and-a-half years. The balance of opinion eroded on all four questions – but responses to the major purchases question were particularly gloomy.
Confidence was down across the country. The biggest drop was in Atlantic Canada, which seems to have suffered a letdown following the wave of jubilation that came with the October 2011 announcement of a $25-billion shipbuilding contract for Halifax Shipyard. Confidence fell 19.4 points in Atlantic Canada and wiped out all of last month’s 15-point gain.
British Columbia registered a third consecutive monthly decline, dropping 10.4 points. Ontario’s index fell 6.2 points to 60.6, while confidence fell 4.8 points in Quebec. The Prairies recorded a drop of just 1.6 points, and its confidence levels remain the highest in the country at 97.2.
Consumers continue to report deep concerns about their financial situation. At a time when the major banks are warning that consumer debt levels have risen to record levels, Canadians say they are losing ground. Only 15.2% of respondents to the survey said they are financially better off today than they were six months ago, down 1.9 percentage points from November.
Canadians’ view of future job creation is particularly negative. At 27.4%, the share of respondents who said they expect fewer jobs in their communities is at its highest level since the summer of 2009-and nearly 9 percentage points lower than one year ago.
Finally, responses to the major purchases questions performed poorly, declining for the eighth consecutive month. The results reflect The Conference Board of Canada’s recent economic forecast, which suggests that consumer spending will remain weak in the coming months.
The December survey was conducted between December 8 and December 18, 2011. The margin of error is plus or minus 2.2%.