Canadians and Americans Share More than a Border -
We Have Similar Concerns about Economy, Employment: RBC
Job anxiety and personal finance are top of mind for Canadian and American consumers
TORONTO, March 22, 2012 — Consumer confidence remains stable on both sides of the border, with 26 per cent of Americans - the highest level in over a year - and 28 per cent of Canadians believing their economies will improve next year, according to the RBC Canadian Consumer Outlook (RBC CCO) and RBC U.S. Consumer Outlook Index (RBC COI).
Canadian and American residents also have similar concerns about their personal financial situation. American consumers' outlook on improvements in their personal financial situation for the next year fell to 26 per cent (down five percentage points from February). In Canada, slightly more than one-third (34 per cent) believe their personal financial situation will change for the better in the year ahead, (down two percentage points from January).
"With both economies showing signs of a recovery, consumers need to continue to focus on managing their money and developing a financial plan that includes saving and investing," said Jason Round, head, Financial Planning Support, RBC Financial Planning. "Sitting down with a financial planner to discuss your options is a good first step to putting a plan in place to be prepared for unforeseen problems or changes. Having an emergency fund and putting a manageable amount of money aside each pay period can really make a difference."
Employment remains a concern for both Canadians and Americans. Although worries are greater south of the border, this is improving, as 26 per cent of Americans (down six percentage points from last month) expressed concerns about job loss. Thirty-four per cent reported that someone in their family or a personal friend had lost their job due to economic conditions, the lowest level in over a year and down from 42 per cent last month. In February, Canadian job anxiety, while lower than U.S. levels, was 21 per cent nationally (unchanged from the month before).
RBC Economics forecasts that Canada's GDP will increase by 2.6 per cent in 2012, while U.S. GDP is forecast to expand by 2.5 per cent, bolstered by the rise in auto sales and growth in consumer spending.
"There is no doubt that recession has weighed on consumer sentiment on both sides of the border; however, there are burgeoning signs that the Canadian and U.S. economies are treading on a brighter path," said Craig Wright, senior vice-president and chief economist, RBC. "A more robust year of broad-based growth is materializing in the U.S., which bodes well for economic growth in Canada. Our domestic economy will also be buoyed by the sustained low interest rate environment, solid balance sheets across corporate Canada, as well as elevated commodity prices in the year ahead."
Other highlights from the surveys include:
- Major Purchases - Canada: When it comes to making major purchases (cars, household appliances or vacation spending), 44 per cent of Canadians believe they will spend less, 38 per cent think they will spend the same and 18 per cent will spend more than last year.
- Purchases - U.S.: In the U.S. fewer than one-in-three (29 per cent) Americans are less comfortable with their ability to make household purchases - the lowest level of household purchase discomfort in over a year.
- Gas Prices - U.S.: Rising gas prices are still a concern with 88 per cent of Americans believing gas prices will rise. Inflation pressure appears to be spilling into durable goods but has not affected food and grocery prices.
The RBC CCO is Canada's most comprehensive consumer assessment of the economy, personal financial situation and economic and purchasing expectations. The RBC U.S. Consumer Outlook Index provides the most up-to-date and comprehensive outlook of U.S. consumers.
About RBC's savings and other financial advice and interactive tools
Canadians can freely access savings advice and resources at www.rbc.com/savingsspot. In addition, all personal RBC online banking clients can use myFinanceTracker, a no-cost interactive financial management tool, to create a budget and track their spending habits. Whether Canadians want to get more from their day to day banking, protect what's important, save and invest, borrow with confidence or take care of their businesses, the RBC Advice Centre can help answer their questions. Interactive tools and calculators provide customized information covering many facets of personal finance. In addition, online advice videos are updated regularly to reflect current trends and to answer the questions that are top of mind with Canadians. With the guidance of RBC advisors who are available to chat live, Canadians have access to free, no-obligation professional advice about RBC products and services and personalized one-on-one service at www.rbcadvicecentre.com.
About the RBC Canadian Consumer Outlook
The survey is conducted online via Ipsos Reid's national I-Say Consumer Panel to 1,013 Canadians. Weighting is then employed to balance demographics and ensure that the sample's composition reflects that of the adult population according to Census data and to provide results intended to approximate the sample universe. Data collection was February 21-27, 2012. A survey with an unweighted probability sample of this size and a 100 per cent response rate would have an estimated margin of error of ±3.1 percentage points, 19 times out of 20, of what the results would have been had the entire population of adults in Canada been polled.
About the RBC U.S. Consumer Outlook Index
The RBC U.S. Consumer Outlook Index provides the most up-to-date and comprehensive outlook of U.S. consumers based on data collected from interviews with a nationally representative sample of more than 1,000 U.S. adults conducted over a multi-day polling period each month by Ipsos, the world's second-largest market and opinion research firm. The results in this news release reflect some of the findings of the Ipsos poll of 1,008 U.S. adults conducted on March 1-4, 2012. The RBC Consumer Outlook Index is released within 36 hours after the U.S. online panel members are interviewed. Weighting is employed to balance demographics and ensure that the survey sample's composition reflects that of the U.S. adult population according to Census data and to provide results intended to approximate the sample universe.
For further information, please contact:
Suzanne Willers, RBC Corporate Communications, 416 974-2727,
Craig Christie, RBC Corporate Communications, 416 974-8820,
Elyse Lalonde, RBC Corporate Communications, 416-842-5634,