Canadians are planning to spend less this holiday season: report

Though we still have to get through Halloween, Canadians are already saying they plan to spend a lot less this coming holiday season.

While many are feeling the financial pinch from rising interest rates, inflation and housing prices, a new 2023 Holiday Retail Outlook survey from Deloitte Canada finds holiday spending is about to reach a five-year low.

• Download our app to get local alerts on your device
• Get the latest local updates right to your inbox 

“If we look back five years ago we are about 20 per cent lower (in retail spending) than we were back then, so we are sort of at the bottom of the trough right now,” Marty Weintraub, Partner and National Leader at Deloitte Canada, said.

Many people are concerned about rising rent and mortgage costs and when you factor in grocery and gasoline prices, there is just less money to go around – that’s why many Canadians said they plan to spend less this year.

According to the 2023 Holiday Retail Outlook Canadians plan to spend $1,347 over the holidays, down 11 per cent from last year.

People go shopping on Christmas Eve at a mall in Ottawa, Thursday, Dec. 24, 2020. THE CANADIAN PRESS/Justin Tang

The survey found that 67 per cent of Canadians are concerned there could be a recession, 55 per cent are worried about rent and mortgage increases, and 33 per cent are concerned about paying for holiday gifts.

Eighteen per cent of respondents said they'll be buying fewer gifts this year, while the report predicts that gift card sales and charity spending will be down 40 per cent. The only increase was for travel spending which was up 11 per cent.

"What we heard from Canadians was not only are they going to spend less, they are going to buy fewer gifts and spend less on each gift to try and spread their holiday love,” Weintraub said.

Those in credit counseling services said they're seeing more people struggling with mortgage costs that have doubled over the past year and they're advising clients to rethink their holiday spending to try and save money.

"We are also seeing people having a hard time making their daily purchases of food and gas,” Anne Arbour, Director of Strategic Partner ships with the Credit Counselling Society, told CTV News.

Arbour added that “just because you've always done it this way (celebrated the holidays), doesn't mean you can't come up with a new way to do something that will leave you in a better place financially.’

While Canadians plan to spend 11 per cent less over the holidays, Americans plan to spend 14 per cent more, with U.S. shoppers feeling more upbeat about their economy.