Concern that the province's economy is worse now than it was three months ago is expected to reduce British Columbians' spending this holiday season, according to a new RBC index.
The RBC Canadian consumer outlook index found that B.C.'s residents are among the least optimistic about their local economy with 46% saying it's worse now than it was three months ago. That's compared with 35% of Canadians who feel the same way about their local economies.
About 43% of British Columbians, and a similar proportion of respondents from Saskatchewan and Manitoba feel their personal financial situation is worse now than it was three months ago, compared with the national average of 39%.
However, British Columbians were among the most optimistic that the national economy will improve over the next year (64%). Although, in the shorter term, they were more cautious with only 44% thinking the economy will improve over the next quarter.
About a third of respondents said the B.C. economy is expected to improve in the next three months, while 19% expect it to worsen.
This perception of the economy is expected to impact spending this holiday season.
About 44% of British Columbians said they will be spending less this Christmas, a bit less than the national average of 47%. Although, the index found 44% of B.C. residents expect to maintain spending, compared with about 35% of Canadians overall.
While more plan to maintain spending, they will still be spending less than the national average. British Columbians expect to spend $1,098 on holiday purchases that include gifts, decorations and entertaining, compared to the national average of $1,218.
The RBC survey is more optimistic about holiday spending than a survey released by the International Council of Shopping Centers that said only 25% of Canadians plan to maintain their holiday spending. About 70% of those that do plan to cut back on gift spending say they will only cut back slightly on gifts for adult family members.
A Deloitte survey in October suggested 51% of Canadians will maintain spending, and 44% will cut back. It suggested consumers plan to focus less on durable goods and more on experience-based gifts like spa getaways and theatre tickets.
Vancouverites are the most likely this year to focus on socializing and entertaining, while residents in Toronto and Montreal plan to focus on home improvements.