Survey reveals financial stress continues to impact workplace productivity and relationships across Canada
The National Payroll Institute has raised concerns regarding the deteriorating financial wellness of Canadian workers, based on the findings from the 16th Annual National Payroll Institute Survey of Working Canadians.
Despite inflation slowing and interest rates dropping, financial stress among working Canadians continues to rise, as tracked since 2021.
The Financial Wellness Lab of Canada analyzed the survey using machine learning, revealing that the proportion of Canadians classified as financially stressed increased to 41 percent in 2024, up from 37 percent in 2023. The financially comfortable cluster declined from 32 percent to 28 percent.
According to the survey, one in four respondents reported living paycheque-to-paycheque, with the inability to meet financial obligations if pay were delayed by a week.
Peter Tzanetakis, president, and CEO of the National Payroll Institute, noted that the growing financial pressures cannot be ignored, urging employees, employers, and policymakers to act.
Two major contributors to this stress are overreliance on debt and escalating housing costs, with 77 percent of the financially stressed cluster feeling overwhelmed by debt, and 89 percent worried about rising housing costs.
In the stressed cluster, 60 percent spend over 40 percent of their income on housing.
Financial stress affects not only individuals but also family relationships, social connections, and workplace productivity.
The survey found that 66 percent of financially stressed respondents acknowledged that financial stress harmed their relationships, and 56 percent reported a negative impact on their work performance.
Financial worries cost Canada $53.9bn in lost productivity annually, a figure that has steadily increased since 2021.
Despite this growing stress, an increasing number of Canadians remain optimistic about their financial future, a sentiment the National Payroll Institute warns may be misplaced without taking action to improve financial habits.
The Institute stresses that urgent action is needed by individuals, employers, and government leaders to reverse the trend of increasing financial stress.
Adam Metzler, lead researcher at Canada's Financial Wellness Lab and Associate Professor at Wilfrid Laurier University, emphasized the importance of acting now to build a more secure financial future.
The Financial Wellness Lab's analysis has consistently shown that focusing on saving, reducing debt reliance, and controlling spending can improve financial wellness.
The survey also found that even among those earning $100,000 or more annually, 29 percent still live paycheque-to-paycheque, underscoring the complexity of financial wellness.
The National Payroll Institute calls for a comprehensive strategy, supported by research-based tools and resources, to improve financial wellness in Canada. This strategy must go beyond basic financial literacy to address the deeper causes of financial stress and support Canadians in achieving long-term stability.
