THREE-QUARTERS (76%) OF CANADIANS BELIEVE COUNTRY IS IN RECESSION

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1 THREE-QUARTERS (76%) OF CANADIANS BELIEVE COUNTRY IS IN RECESSION Far Fewer Expect Quick 12-Month Turnaround (25%; -11 since 2015), as More than a Third Now Settling in for Longer Haul of Months (17%; +5) or More than Two Years (19%; +8). INCREASING PESSIMISM ACROSS CANADA, AS TWICE AS MANY EXPECT ECONOMY WILL GET WORSE (44%) THAN IMPROVE (20%) IN 2016 Declining Expectations for Stock Market, U.S. Economy, and Global Economy. Majorities Expect National Debt, Taxes, and Inflation to Rise and the Loonie to Continue to Fall. Most Expect Interest Rates to Rise (38%) or Stay the Same (39%) JOB LOSS FEARS AT HIGHEST LEVELS RECORDED IN LAST 21 YEARS A Third (32%) Feel it is Likely They or Immediate Family Member May Lose Job in EMOTIONAL ASSOCIATION TEST REVEALS THAT ECONOMY STIRS LARGELY NEGATIVE EMOTIONS AMONG CANADIANS, WITH ANXIETY THE DOMINANT EMOTION Overall, Canadians hold Mixed Emotions about their Personal Finances. However, Upper Income Brackets Much More Likely to Feel Positive than Lower Brackets. (Toronto, Ontario, February 4, 2016) Three-quarters (76%; -4 since 2015) of Canadians believe the country is in recession. Although this may be expected following a year with reports of a technical recession, the Economic Outlook study has found that a majority of the public has felt that Canada has been in recession for eight consecutive years. Across Canada s regions, residents of Alberta (91%) and BC (81%) are much more likely to feel the country is in a recession than residents of Atlantic Canada (76%), Ontario (74%), Prairies (73%), and Quebec (71%). Interestingly, the upper income brackets hold more a more negative assessment of the economy. Canadians in the $100,000+ household income bracket (81%) and $50,000 to less than $100,000 bracket (80%) are much more likely to say Canada is experiencing a recession than those in the under $50,000 bracket (67%). However, compared to last year, far fewer of those who feel this way expect a quick turnaround, as 25% (-11 since 2015) expect the recession to conclude in 6-12 months compared to 36% in Instead, more than a third (36%) now expect the recession to conclude in months (17%; +6) or more than 2 years from now (19%; +7). Three-in-ten (29%; +3) expect the recession to be over in months. CraigWorden@pollara.com Ext

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3 In 2015, most Canadians saw a turnaround was on the horizon, but this optimistic sentiment has dampened, said Pollara Executive Vice-President Craig Worden. A sizeable and increasing proportion of the public is now settling in for a longer haul. INCREASING PESSIMISM ACROSS ALL ECONOMIC INDICATORS Representing notably more pessimistic views than in 2015, twice as many Canadians feel that the economy will worsen (44%; +8 since 2015) than improve (20%; -5) in This pessimistic outlook also exists for the country s employment situation and economic indicators beyond Canada s borders. Although the public is divided in terms of their expectations for the U.S. economy (25% improve vs. 27% worsen), clear pluralities expect Canada s employment situation (40%), the stock market (44%), and the global economy (46%) to get worse over the next 12 months. Similarly, majorities expect Canada s national debt (71%), taxes (62%), and inflation (60%) to increase in 2016, and 58% expect the value of the Canadian dollar to further decrease during this year. Most expect interest rates to either rise (38%) or not change (39%) just 13% expect lower rates. In a muted economic environment where low growth and uncertainty are the new normal, Canadians have settled into a pessimistic, low-expectation mindset, said Pollara Executive Vice-President Craig Worden. The economy now inspires anxiety rather than confidence. CraigWorden@pollara.com Ext

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5 OVERWHELMINGLY NEGATIVE EMOTIONAL ASSOCIATIONS WITH THE ECONOMY In this wave of the annual study, Pollara Strategic Insights included new questions to assess the public s emotional associations with the economy. The survey found that the economy stirs largely negative emotions among Canadians. Seven-in-ten (72%) Canadians feel at least one negative emotion about the economy, whereas just 37% of Canadians feel at least one positive emotion. Overall, anxiety is the dominant emotion, with a majority indicating they are worried (53%), followed by three-in-ten who say they are pessimistic (30%) and/or resigned (28%). Almost a quarter said that they were sad (24%) or upset (24%) about the economy. Across Canada s regions, Albertans (25%) are much less likely to hold positive emotions about the economy than residents of Atlantic Canada (43%), Ontario (40%), Quebec (38%), BC (37%), and the Prairies (34%). Women (30%) are less likely to express positive emotions about the economy than men (44%). Note: Survey respondents were allowed to choose up to 4 different applicable emotions from a list of 14. Therefore, the proportions across all emotions will total more than 100%. PERSONAL FINANCIAL SITUATION The personal financial situation of Canadians remains largely unchanged since last year. As in 2015, about half (49%; -1 since 2015) continue to say they are holding their own, with about a quarter (24%; -1) indicating they are getting ahead and another quarter (24%; +1) losing ground. Residents of Manitoba and Saskatchewan are more likely to indicate they are holding their own (58%) and less likely to indicate they are losing ground (16%). Canadians aged 55 and older are more likely to be holding their own (56%) and less likely to be getting ahead (15%). Canadians in the $100,000+ household income bracket (41%) are far more likely to say they are getting ahead than with a household income of $50,000 to less than $100,000 (25%) or those with a household income of less than $50,000 (18%). Similarly, the $100,000+ household income bracket is far less likely to report losing ground (13%) than the $50,000 to less than $100,000 bracket (24%) and less than $50,000 bracket (29%). COST OF LIVING Similarly, half (50%; -1 since 2015) of Canadians continue to say their household income will keep pace with the cost of living. More than a third (37%; +2) continue to expect to fall behind, and 9% (-3) of Canadians think they will more than keep pace with the cost of living in Canadians in the $100,000+ household income bracket (20%) are far more likely to say they are more than keeping pace than with a household income of $50,000 to less than $100,000 (8%) or those with a household income of less than $50,000 (6%). Similarly, the $100,000+ household income bracket is far less likely to report falling behind (21%) than the $50,000 to less than $100,000 bracket (36%) and less than $50,000 bracket (45%). CraigWorden@pollara.com Ext

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7 FEARS OF JOB LOSS REMAIN AT HIGHEST LEVELS IN 21 YEARS Fears of job loss remain at the highest levels recorded in the last 21 years. About a third (32%; -1) of Canadians say it is very or somewhat likely that they or an immediate family member may lose their job in Across Canada s regions, residents of Alberta (41%) and Quebec (36%) are the most likely to expect job losses, compared to residents of Ontario (30%), BC (29%), the Prairies (27%), and Atlantic Canada (25%). Canadians aged (39%) are far more likely to expect job losses than those aged (34%) and 55+ (24%). Canadians with a household income under $50,000 (38%) are much more likely to expect job losses than those with a household income from $50,000 to less than $100,000 (30%) and those in the $100,000+ household income bracket (28%). In 2009, 31% of the public expressed this likelihood, but only a quarter or less of Canadians continued to feel this way from 2010 to In 2014, however, 34% felt job loss was likely and this expectation and concern remained at this level in 2015 (33%) and in our current sounding of Canadian sentiment. CraigWorden@pollara.com Ext

8 MIXED EMOTIONS ABOUT PERSONAL FINANCIAL SITUATION Although Canadians hold overwhelmingly negative emotions about the economy, they hold mixed emotions about their personal financial situation. Six-in-ten (62%) Canadians feel at least one positive emotion about their finances, and 56% feel at least one positive emotion. Overall, anxiety is the leading emotion, with 39% indicating they are worried. However, about a third of Canadians also feel calm (34%), optimistic (33%), and confident (31%). Canadians in the $100,000+ household income bracket (79%) are far more likely to hold a positive emotion about their personal financial situation than those with a household income from $50,000 to less than $100,000 (66%) and those with a household income under $50,000 (53%). Similarly, those in the $100,000+ bracket (38%) are far less likely to hold a negative emotion about their financial situation than those in the $50,000 to less than $100,000 bracket (56%) and those in the less than $50,000 household income bracket (63%). On the surface, Canadians have mixed emotions about their personal financial situation, but those in the upper income brackets actually have a largely positive outlook, said Pollara Executive Vice-President Craig Worden. As we see with their personal expectations and sense of job security in 2016, the upper income brackets feel more confident than those in the lower income brackets who are telling us a story of greater challenge and volatility. CraigWorden@pollara.com Ext

9 BACKGROUND About this survey: From January 12-17, 2016, Pollara Strategic Insights conducted an online survey of a randomly-selected sample of 1,000 Canadians aged 18 and older. As a guideline, the margin of error for a probability sample of this size is ±3.1%, 19 times out of 20. The results have been statistically weighted according to the most current gender, age, and region Census data to ensure a sample representative of the entire population of Canadians aged 18 and older. Any discrepancies in or between numeric totals are due to rounding. About Pollara s Economic Outlook Study: Every year since 1995, Pollara has conducted an annual national survey among Canadians about their perceptions and expectations for their personal financial situation, the economy, and other related financial and economic indicators. Economic Outlook is Canada s longest running tracking study of fiscal and economic perceptions, and the 2016 edition represents the 21 st wave of the study. In the current wave, new questions were added to the standard tracking questions in order to gauge the public s emotional associations with the economy and their personal finances. Although the public s assessment does not always agree with the statistical evaluation of the economy, it is an important indicator of public sentiment as well as the future direction of the economy. Indeed, the edition of Economic Outlook released in January 2008 revealed that the public expected a downturn that year well before stock markets tumbled and the recession took hold. About Pollara Strategic Insights: Founded in 1980, Pollara Strategic Insights is one of Canada s premier full-service research firms a collaborative team of senior research veterans who are passionate about conducting research through hands on creativity and customized solutions. Taking full advantage of their comprehensive toolbox of industry-leading quantitative and qualitative methodologies and analytical techniques, Pollara provides research-based strategic advice to a wide array of clients across all sectors on a local, national, and global scale. For more information, please visit INFORMATION & CONTACT The full results of the entire survey are appended to this press release in the form of a PowerPoint slidedeck and data tables. All documents can be found in the Media section of For more information, please contact: Craig Worden Executive Vice President Pollara Strategic Insights CraigWorden@pollara.com Ext Craig Worden is a member of the Canadian Association of Public Opinion Research (CAPOR). CAPOR s Code of Conduct and Common Standard of Disclosure ensures the highest standard of scientific competence, integrity, accountability, and transparency in designing, conducting, analyzing, and reporting research. More information about CAPOR can be found at CraigWorden@pollara.com Ext