{"id":4607,"date":"2014-01-09T14:47:47","date_gmt":"2014-01-09T19:47:47","guid":{"rendered":"http:\/\/pierreroy.com\/?p=4607"},"modified":"2015-01-13T12:06:25","modified_gmt":"2015-01-13T17:06:25","slug":"a-difficult-year-financially-for-quebecers","status":"publish","type":"post","link":"https:\/\/pierreroy.com\/en\/2014\/01\/a-difficult-year-financially-for-quebecers\/","title":{"rendered":"A Difficult Year Financially for Quebecers"},"content":{"rendered":"

Just as many of us thought we were coming out of an economic recession and that things were getting better, we realize that it is not the case for everyone.<\/p>\n

Following the financial crisis of 2007-2008, in 2009 Quebec saw a record of 44,000 insolvencies (bankruptcies and consumer proposals). We then experienced a slow decline in the rate of insolvency until 2012. However, the year 2013 ended on a bad note with a resurgence in the number of insolvencies. What happened in 2013? Why this sudden rise in bankruptcies?<\/p>\n

A Quebec-Only Issue<\/h3>\n

The latest statistics from the Office of the Superintendent of Bankruptcy Canada (OSB) are showing a significant increase in the number of insolvencies for the province of Quebec. The data from the OSB shows an average increase of 11.9% for the first three quarters of 2013 for Quebec while there was an average decrease<\/em> of 7% for Ontario. Overall, in Canada the situation has been stable in 2013.<\/p>\n

Bankrupt, but With a Job<\/h3>\n

When we want to explain an increase in the number of bankruptcies, the first thing we look at is the employment rate. For obvious reasons, when there is loss of jobs, there is usually a rise in insolvencies. But when we look at the statistics for 2013, we can\u2019t find any correlation between the two. The job market is relatively healthy and grew by 1.2% (44 600 new jobs) in Quebec in 2013. The average for Canada was 1.3%.<\/p>\n

Addicted to Credit<\/h3>\n

In a recent survey, the RBC found that the average debt of Canadian families has increased from $13,141 in 2012 to $15,920 in 2013. This increase of more than 21% is alarming. However, if we take a look only at Quebec, the numbers are much less frightening. Indeed, the increase in debt for Quebec families is only of $287 \u2013 much less than the Canadian average.<\/p>\n

A Sluggish Economy<\/h3>\n

Still trying to explain the increase in the number of bankruptcies, we took a look at the pace of the economy. The year 2013 has been a disappointing year with less new homes (26% less than in 2012) and a decrease in the price of condos. In fact, the economy of Quebec has grown 0.9% in 2013 compared to 1.4% for Ontario and 1.7% for Canada. The Parti Qu\u00e9b\u00e9cois has not been able to stimulate the economy as much as they had planned and the slowdown means less income for the government.<\/p>\n

Hopefully, 2014 will be a better year for the Quebec economy with more growth and more new jobs.<\/p>\n

Sources<\/h3>\n