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Canada’s Four Month Streak of Confidence Growth Snaps in April

Canadian Economics

By: Walter Bolduc

The Index of Consumer Confidence Decreased 8.5 points in April.

  • The Index of Consumer Confidence (ICC) reversed course after four months of continuous improvements, falling 8.5 points to 59.3 (2014=100) in April.
  • Canadian consumers’ optimism fell in all categories in April.
  • The percentage of individuals who felt their current finances had improved fell from 12.5 to 12.0 per cent. Individuals who considered their finances unchanged fell from 52.7 per cent to 51.4 per cent. Consumers who thought their finances were worse increased for the first time in five months from 32.3 to 34.5 per cent.
  • Optimism about future finances dropped, as the proportion expecting better finances fell from 17.4 to 14.4 per cent. Like current finances, individuals who considered their future finances unchanged fell from 49.9 per cent to 49.2 per cent. Those anticipating worse conditions increased 3.1 percentage points to 27.6 per cent.
  • The share of consumers who believed there would be the same number of jobs in the next six months decreased 2.9 percentage points to 50.0 per cent. Meanwhile, a smaller proportion were optimistic about there being more jobs in the next six months (decreasing from 9.9 to 9.1 per cent). The share of those predicting fewer jobs increased from 25.3 to 28.0 per cent.
  • The outlook for major purchases showed mixed results. The proportion of consumers who thought it was a good time to make a major purchase fell from 10.8 to 9.5 per cent, but the percentage of consumers who believe it was a bad time fell from 67.6 to 66.5 per cent.

Key insights

  • A weaker job market is resonating with consumers. Two of the driving forces behind the decline in confidence are outlooks on future finances and job prospects. Influencing both are weaker labour market conditions. The employment rate inched down to 61.4 per cent in March following six consecutive monthly declines and the unemployment rate reached 6.1 per cent, its highest level since January 2022. This translates to 60,000 more unemployed consumers compared to February. Job vacancies have also declined over the past year, putting further downward pressure on wages and hurting confidence.
  • British Columbian confidence craters 30.7 points as wildfires pick up. This drop in confidence is the largest month-to-month drop for the province since the onset of the COVID pandemic. Coinciding with this drop in confidence is an early start to British Columbia’s wildfire season. So far this year, British Columbia has experienced close to 200 fires burning over 2,000 hectares, 44 of which started mid April. British Columbia’s government reported that last year’s wildfire season was its worst in history. An early start to the season could have raised concern among many residents that this season will be similar.

For current insight into changes in the volume of online job postings across different sections geographic areas, industries, and occupations over time. Please refer to our Canadian Hiring Index.

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