From April through July 2020, BCBC produced four surveys and several blogs exploring how large businesses were managing through the first phase of the COVID-19 pandemic (see Survey One Part 1, Part 2, Part 3, Survey Two, Survey Three and Survey Four).

Recently, BCBC took the opportunity to explore how the pandemic is impacting households’ finances.[1] In our November 24 survey of 1,008 households across B.C. (among respondents who are members of the Angus Reid Forum) we asked the following:

Since the start of the COVID-19 pandemic in mid-March, have you made any of the following financial adjustments?

B.C. households have made many changes to their finances

Figure 1 provides the results. Over two-thirds of B.C. households have made one or more adjustments to their finances due to COVID-19.[2]Among households that have made changes, the most common responses were:

• “Cut spending on non-essential goods and services” - 41% of households;
• “Deferred or cancelled a planned major purchase” – 30%;
• “Received the Canada Emergency Response Benefit (CERB)” – 17%;
• “Held more liquid assets (e.g. cash) than normal” – 14%; and
• “Received other emergency government benefits” – 12%.

Other actions include selling assets to generate cash flow and/or making extra loan repayments to reduce outstanding loan balances. About one-in-twenty households have moved or renovated their principal place of residence to make life easier during COVID-19. Similarly, about one-in-twenty households have deferred mortgage payments. Less common actions were the deferral of rent payments or defaulting on loans.

Figure 1

Roughly one-in-six B.C. households say they relied on the CERB

One of the striking statistics that emerges is the high proportion of British Columbians who have relied on emergency government benefits during COVID-19. My colleague, Ken Peacock, has examined this issue here. Figure 2 shows the survey responses by region, gender, age, income, and education.

Overall, 17% of B.C. households say they relied on the Canada Emergency Response Benefit (CERB) and 12% relied on other government emergency benefits:

• Men and women relied on the CERB in similar proportions;
  
• Young-/middle-aged households were the most reliant on the CERB. Young households also depended heavily upon other benefits; and
• Low-/middle-income households were the most reliant on the CERB. Low income households were also the most reliant on other benefits.

Figure 2

Conclusion

The B.C. economy has been hard hit by the COVID-19 pandemic. Many households have had to cut spending or defer planned major purchases, or have become more conservative in respect of their balance sheet. A sizable proportion of B.C. households have relied on the CERB and other emergency government benefits since mid-March.

A future blog will look at the overall responses in more detail.

[1]A survey conducted among a representative sample of n=1,008 British Columbians (age 18+ years.) who are members of the Angus Reid Forum. The sample frame was balanced and weighted on age, gender, region, and education. The survey was conducted in English from November 24-25, 2020. For comparison purposes only, a probability sample of this size would yield a margin of error of +/- 3.09 percentage points, 19 times of out 20.

[2] About 30% of households cited “None of the above” (and 2% of households said “other”), leaving around two-thirds of households citing at least one modification to their financial arrangements due to COVID-19.