‘While the pandemic has forced many to refrain from spending beyond their means, it simultaneously created drastic uncertainty about the economy’
Despite the trials and tribulations of the COVID-19 pandemic, many Canadians are saving money this year compared to last year, according to a survey.
With many people not commuting, buying lunches or paying for childcare because they are working from home, slightly more workers (62 per cent) are able to save more than five per cent of their paycheque compared with 59 per cent in 2019.
And six per cent fewer reported “living precariously” from paycheque to paycheque -- the lowest in the 12-year history of the survey by the Canadian Payroll Association.
This, however, does not mean that they are not financially stressed. Despite saving more, a greater proportion of Canadians are financially stressed these days, and the gap between those who are struggling and those who are comfortable has widened.
In 2020, 43 per cent are financially stressed and 22 per cent are in the comfortable cluster, compared to one-third of each cluster from 2009-19, finds the survey of 4,264 working Canadians.
“It’s hard to separate the statistically significant growth of workers who are financially stressed from the COVID-19 pandemic,” says Peter Tzanetakis, president of the Canadian Payroll Association.
“For over a decade, the financial wellness of working Canadians has been directly linked to core, stable, long-term factors. While the pandemic has forced many to refrain from spending beyond their means and save more, it simultaneously created drastic uncertainty about how the economy will endure into the future.”
Canadians are showing greater concern when it comes to economic issues:
- 62 per cent of those deemed comfortable are now deeply troubled by the prospect of inflation, compared with 47 per cent in 2019.
- 52 per cent of financially stressed workers are nervous about their ability to retire, compared to 45 per cent last year.
Even before the pandemic, people with healthy incomes were stressed about their financial fitness, according to an earlier study from the Canadian Payroll Association and the Western-Laurier Financial Data Analytics Laboratory (The Western-Laurier Lab).
“Despite remaining on payroll and being in a measurably better financial position right now, financial stress this year was impacted by a complex combination of new factors – including those that are more psychological than financial in nature,” says Adam Metzler, associate professor of mathematics at Wilfrid Laurier University and one of the leads on the team that analyzed the data.
Nearly 69 per cent of respondents to the Canadian Payroll Association survey reported that they spend time at work thinking about personal financial matters. For businesses across Canada, this adds up to an estimated $20.3 billion in lost productivity.
“That estimate is a conservative one,” says Tzanetakis. “The costs of increased absenteeism, decreased motivation, strained relationships with colleagues, and turnover that many respondents cite as consequences of financial stress, also need to be taken into account. Simply put, it’s smart business for organizational leaders to pay attention to and support the financial wellness of employees.”
Financial stress could see workers going back to work even if they feel sick, according to an earlier survey by the Canadian Payroll Association.