Left reeling by the effects of the global oil shock, the Alberta population has suffered critical impacts on its economic and purchasing power over the past few years, the latest of which is the spike in debt delinquencies, which shot up to 25 per cent compared to the same time last year.
In a report released on Thursday (March 10), credit bureau Equifax Canada noted that Alberta has the country’s highest average debt load at over $27,000—hardly a surprise for local experts.
“We're seeing people who have been laid off, or had their hours or their pay cut back from employers, and so now they're not able to manage all their debt payments,” Calgary insolvency trustee Donna Carson told CBC News
The study assured, however, that there’s no cause for undue panic as of yet.
“It may be a surprise to some, but the fact is delinquency rates in the oil-producing provinces are still relatively low. Most people are still finding a way to pay back what they owe,” Equifax Canada senior director of decision insights Regina Malina stated in a press release.
“Despite the ups and downs of today's economy we're seeing that Canadians are generally able to manage debt and rein in spending when they have to,” Malina said, adding that the nationwide delinquency rate remained flat.
In another report last fall, credit rating body TransUnion said that the rise in Alberta’s delinquency rate could be attributed to a greater number of debtors under the age of 26 failing to fulfill their obligations, with a 2.9 per cent increase in this group.
“Debt is often used as a tool for consumers to accomplish their objectives. However, as people get older, their income earning capabilities generally trend downward,” the Equifax report observed.
Equifax figures placed average debt (excluding mortgages) in Calgary at $28,421, significantly above the national average of $21,458. Total consumer debt in Canada is now at $1.621 trillion.