Canada may have only recently entered a technical recession, but new analysis by Harris & Partners suggests many households have been living with the reality of economic hardship for much longer.
Following confirmation that Canada’s economy contracted for a second consecutive quarter, meeting the widely accepted definition of a technical recession, Harris & Partners said it reviewed findings from multiple nationwide surveys conducted throughout 2025 and 2026.
The recession follows a difficult period for Canada’s labour market. More than 112,000 jobs were lost between January and April this year, while unemployment rose to 6.9% before easing slightly in May. Young Canadians have been among the hardest hit, with youth unemployment remaining significantly higher than the national average, it said.
The issue has fuelled growing debate around employment opportunities for younger workers, particularly as Canada continues to reassess temporary resident and temporary foreign worker levels following years of rapid population growth. The research, which includes responses from more than 6,500 Canadians, reveals widespread financial pressure, growing uncertainty and significant changes in spending behaviour long before the recession was officially confirmed, it added.
Among the key findings:
- 95.2% of Canadians say rising costs have impacted their finances
- 91.6% have changed how they manage their money due to economic conditions
- 91.0% feel their financial situation can change quickly due to factors outside of their control
- 88.0% have postponed or cancelled plans such as travel, major purchases or other life goals because of rising costs
- 87.0% say they feel financially trapped due to rising living expenses or debt
- 85.0% report their monthly expenses have increased over the past year
- 76.3% say job or financial stress has negatively affected their mental health
- 60.0% are concerned about job security or household income due to wider economic pressures
“The technical recession may only have recently been confirmed, but many Canadians have been feeling the effects of economic uncertainty for some time. Across multiple studies conducted over the last year, we’ve consistently seen the same themes emerge: rising costs, delayed plans, financial insecurity and growing stress about the future. For many households, the pressure has been building long before the economic data reflected it,” said Joshua Harris, CEO of Harris & Partners and a Licensed Insolvency Trustee.
“Economic data only tells part of the story. Behind those figures are households dealing with rising costs, uncertainty around employment and concerns about their financial future.”
“When we see more than 112,000 jobs disappear over a matter of months, it’s understandable that Canadians become more cautious about spending and long-term financial commitments.”
“Recent job losses and ongoing concerns around employment are only adding to that uncertainty. When people become less confident about their future income, they naturally become more cautious with spending and long-term financial decisions.”
The company said the findings suggest Canadians have already been adjusting their financial behaviour in response to worsening economic conditions. Nearly half of respondents said they had reduced spending, while more than one in five reported delaying purchases altogether. Others said they had relied on savings or increased their use of credit to manage everyday expenses.
According to Harris, these shifts point to a broader decline in consumer confidence.
“When people start delaying major purchases, cancelling plans and changing how they manage money, it often reflects uncertainty about what lies ahead. Households become more cautious because they feel less confident about their financial stability,” he said. “What we’re seeing is not simply a response to higher prices. It’s a response to uncertainty. People are worried about how quickly circumstances can change and whether their income will keep pace with the cost of living.”
“For younger Canadians in particular, the current environment is proving challenging. Entering the workforce, building savings and planning for the future becomes far more difficult when employment opportunities are less certain and competition for entry-level roles is increasing. Many young people are trying to establish financial independence at a time when housing costs remain elevated, everyday expenses continue to rise and the labour market is becoming more competitive. Those pressures can have lasting financial consequences.”
Harris & Partners said the research also highlights the human impact of prolonged financial pressure.
More than three-quarters of respondents said job or financial stress had negatively affected their mental health, while 58% reported feeling burned out or emotionally drained during the past 12 months. More than a third said they had skipped meals or other essentials to make ends meet, while one in three admitted using credit to cover basic living expenses such as groceries, rent or household bills, it said.
Harris said the findings demonstrate that economic downturns are about far more than GDP figures and economic forecasts.
“When financial pressure begins affecting people’s mental health, relationships and day-to-day wellbeing, it becomes much more than an economic issue,” he added.
“Many Canadians have spent the last year making difficult decisions simply to stay on top of rising costs. The recession may be a new headline, but for many households, the financial strain behind it is already a familiar reality.”
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