Canadians Wrongly Believe We are in a Recession: Poll

Sometimes a little bit of information can be a dangerous thing.

This is apparently being reflected by many Canadians in terms of their views and attitudes on the Canadian economy. According to a recent survey sponsored by the Economic Club of Canada, many Canadians believe that we are in recession, when in fact we are not.

The poll found that only 25% of respondents feel optimistic about the economy, which represents a drop of more than 10% from last year. A staggering 70% of respondents believe that the country is experiencing a mild recession, while economists insist that, while the economy faces some challenges currently, we most certainly not in a recession.

It’s no big surprise, really. Everywhere Canadians turn these days there is negative economic data, cautious warnings about slowing economic growth, dwindling consumer spending in the face of elevated household debt levels and employment uncertainty.

Coupled with the constant media attention on the fact that the Euro zone is likely facing a recession, it is not entirely unexpected that Canadians, who may not have access to all the data, or the training to interpret it, may think that the country is in fact, in a recession.

It’s not just misperception either; the findings of this online poll suggest that there is a disconnect between the crunching of numbers, presentation of data, and the way that Canadians actually feel about their economic prospects in general.

While most Canadians do not have economic training, many do feel that they are involved with it- in that they are on the receiving end of the financial impact.

While things are perhaps not optimum, they could be much worse economists argue. Economic growth is slow, but is expected to sluggishly tick along; while unemployment is increasing, it is still lower than it has been in the past. Some pockets of the country are even experiencing a job boom.
The housing market, for instance, continues to outshine and outpace the economy, taking advantage of the sound fundamentals that propel the market for growth. While many expect the market to moderate in 2012, it is still expected to grow at a reasonable pace.

As Penney points out too, there is a clear role for Mortgage Professionals to help cut through all the news reports and statistics: “Of course, as professionals, we need to remain upbeat about the economy ourselves. Not to create the notion for our clients that everything is rosy, but to explain and confirm things like how our economy is built on strong financial practices, and that the trouble that we see in other places such as the US and Europe, were brought on by acts of greed and complacency, particularly when it comes to the banking sectors. By doing so I believe we can clarify many of the stories that these people are seeing on television and reading in the newspapers about the world is going to collapse.”

If you are interested in more information please let me know as there is an Economic Update being presented by the Assistant Chief Economist from RBC at my office.  It is a no-cost event but you require an invitation to reserve a seat.