In a peculiar economic moment, Canada finds itself in what some economists are calling a “me-cession.” While the country’s overall economy continues to grow, individual households are facing challenges that make it feel like a recession for many Canadians.
Traditionally, economists define a recession as two consecutive quarters of negative growth in real gross domestic product (GDP), often accompanied by rising unemployment. However, Canada has managed to avoid a technical recession, even though its growth has been sluggish. So, what exactly is this “me-cession”?
Understanding the “Me-cession”
- Not Just Numbers: The term “me-cession” reflects the disconnect between macroeconomic indicators and the everyday experiences of Canadians. While GDP numbers may look positive, households are feeling the pinch.
- Stagnant Wages: Despite economic growth, wages have remained stagnant for many workers. As costs of living rise, families find it harder to make ends meet.
- Financial Stress: Polling data shows that 46% of Canadians are losing sleep over their finances. People are cutting back on dining out, delaying large purchases, and even putting off moving to cope with financial stress.
- Consumer Behavior: Businesses report consumers paring back spending, and households express feeling stressed. This behavioral shift contributes to the “me-cession” sentiment.
In summary, the “me-cession” highlights the gap between economic statistics and the lived experiences of Canadians. While the economy stays afloat, many households struggle to get ahead. It’s a reminder that economic well-being isn’t just about national GDP; it’s about the financial health of individuals and families.
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