Covid-19 is wreaking havoc on financial health of Canadians

**This article was co-authored with Elvis Wong from Innovate Financial Health


Just a few weeks into the COVID-19 pandemic we have evidence that COVID-19 is wreaking havoc on the financial lives of Canadians. Income is being lost, savings balances depleted, and most acknowledge that this crisis is having an adverse impact on their financial well-being.


The survey was launched during the week of April 6th of 2020. This was three weeks after the federal government issued a stark warning to Canadians — to stay home as much as possible, avoid crowds, and keep away from others or to face additional enforcement measures.


Close to 300 respondents across Canada participated in the survey. The majority of respondents was from Ontario (72%) followed by British Columbia (9%), Alberta (5%) and Quebec (5%). Most respondents resided in urban areas (70%), and a small portion lived in the suburbs (26%), and rural Canada (4%). There was variability amongst gross income levels with the largest portion earning between $50,000-$74,999 (26%) followed by $30,000-$49,000 (15%).


1. We are already seeing a degradation of financial health due to COVID-19

A fifth of respondents have experienced changes in their employment situation

2. Many Canadians saw a decrease in their expenses, but not rent

Expenses, like income, also decreased

3. Many Canadians did not have the adequate savings to help them navigate the crises, and looked to the government for support

A large number of Canadians do not have a sufficient enough emergency fund

4. Two groups were hardest hit by the pandemic — self employed workers and lower income Canadians

Self-employed workers lost jobs and saw sharp decreases in income

5. Despite the financial hardship, Canadians are optimistic about their future

Most were optimistic about their ability to bounce back financially from the adverse effects of the crises.


1. Our emergency response measures need to be more inclusive

The experience of self-employed workers during COVID-19 highlights the need for a revamp in our emergency response measures, to ensure inclusivity and fairness. Self-employed workers must be covered by government benefits from the onset, and these benefits have to be adjusted to better suit the realities of these workers. Income replacement programs like CERB should not exclude those who have seen significant decreases in their income, but are still earning something. Self-employed workers have been at the front line of this COVID-19 battle. They must not be overlooked in any future emergency response measures.

2. Our social safety net needs to be revamped

COVID-19 appears to have peaked in Ontario, and it is likely that Canada has gone through the worst of the pandemic. It might soon be time to shift our focus to planning for equitable economic recovery, where the needs of self-employed workers should be given equal consideration and where our benefits system goes through a radical reform.

3. Individuals and Small businesses need rent relief

For both individuals and small businesses, rent serves as a major expense. As incomes of individuals and small businesses continue to be disrupted, many risk further financial precarity because of their need to pay this important expense. However, less than 15% of respondents indicated receiving any type of rent relief from their landlords. These efforts have been directed by the initiative of individual landlords rather than any government-wide initiative. In places like the UK and Australia, efforts such as a national moratorium on commercial rent evictions have been implemented. Canada needs similar action to provide rent support for Canadians both at an individual and small business level.

4. We must find better ways to help Canadians build emergency funds

COVID-19 has highlighted how few Canadians actually have emergency funds in the case of a disruption of their income. In this day and age, it is difficult to build an emergency fund with cost of living skyrocketing and wealth inequality widening. We need to find different ways to encourage Canadians to build emergency funds. These solutions could include scaling matched-based savings programs to help low-income Canadians build emergency funds as has been done by fintech Quber and Calgary-based non-profit Momentum for low-income Calgarians (link). It can also include enabling employers to implement solutions that help their employees build emergency savings funds as has been done by Nest Insights in the UK (link)


We would like to thank Roger Morier for his support on communications and Bankable Frontiers Associates for the use of their survey tool.

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