COVID-19 is Exacerbating the Financial Stress of Working Canadians

Published July 28, 2020, by The Canadian Payroll Association

Layoffs and three million job losses. Business bailouts and closings. These are the stark realities of 2020 in the wake of COVID-19.

Canadians who continued to work throughout the pandemic have been rightly considered the lucky ones — able to focus on the immediate physical danger and overcoming the psychological impacts of quarantine-imposed isolation. Because they have continued to receive a paycheque, the assumption has been that they are doing okay. That there is no need to worry. The truth, however, is that even for those still on payroll, COVID-19 has had a significant negative impact on financial wellness.

In our new survey of over 4,000 working Canadians, we found that 58 per cent feel more stressed about their finances due to the pandemic.

What are Working Canadians Worried About?

One particular concern affecting working Canadians is job security, with one-in-three, not having lost their job already, sharing that they are fearful of losing their job due to COVID-19. And, while 77 per cent have been working from home during the pandemic, as workplaces begin to open, that fear may cause many (one-in-five) to go to the office even when they are coughing, sneezing and feeling sick.

The survey also notes substantial macro-economic worry. Sixty per cent of employed Canadians indicate they are worried about the Canadian economy, and 55 per cent are concerned about Canada’s employment situation. Additionally, fear of the economy performing poorly is at its highest rate in five years — up 46 per cent from last year.

To add a final layer of financial stress, employed Canadians are witnessing the impact of the pandemic on their workplaces, with over half reporting that their company has been seriously impacted economically by COVID-19.

The repercussions of the pandemic continue to threaten our country’s return to stability. Our research shows that COVID-19 has directly affected the financial stress of working Canadians, many of whom express deep concern about the economy as a whole. Recognizing that financial stress already costs Canadian businesses billions of dollars, developing strategies to help Canadians decrease or manage that stress should be a part of our broader strategy for economic recovery.

What can we do?

One way that employers can help minimize the impact of financial stress on working Canadians is offering financial education or access to programs that encourage savings through payroll, such as a Pay Yourself First Program. Employees can take action by taking part in these programs.

A Pay Yourself First Program allows employees to work with payroll to ensure a portion of their paycheque is automatically deposited into a separate savings account. This encourages better money management and the steady accumulation of retirement funds, all of which are key concerns related to financial stress for working Canadians.

With proper savings techniques in place, working Canadians can position themselves in the best possible way to navigate unexpected financial situations, should they arise.