Impact of Downturn Still Being Felt: ATB Investor Beat

Edmonton — Nearly half of Albertans (49 per cent) have felt the impact of the drop in oil prices according to the latest edition of the ATB Investor Beat Survey. That’s up one per cent from the previous survey. Among those impacted, 30 per cent said they had lost their jobs, up from 24 per cent three months earlier. Millennials (18-34 years of age) and Gen Xers (35-54) are more likely to have suffered job loss than Boomers (54+).

Other impacts reported include salary freezes or reductions, increased cost of living and a decline in real estate value.

Most Albertans impacted by low oil prices are coping by reducing personal spending (68 per cent), while others have changed vacation plans (30 per cent), stopped regular savings/investment contributions (27 per cent) and put off making major purchases (27 per cent). That being said, fewer Albertans said they are behind on their retirement savings goals, with 44 per cent reporting they were behind, compared to 52 per cent in the previous Investor Beat.

“With the economic slowdown now well into its second year, many Albertans are feeling the pinch,” said Chris Turchansky, President of ATB Investor Services. “While some have had to make some serious adjustments with how they spend and save money, it’s encouraging and surprising to see more Albertans are on track with saving for retirement. It could be an indication that people are changing their savings goals towards retirement.”

Still, the percentage of Albertans holding mutual funds, stocks and bonds has dropped since the previous Investor Beat. As of April, 53 per cent of Albertans hold these types of investments, compared to 61 per cent in the previous survey. Easily-accessible cash accounts are becoming increasingly popular, especially among Millennials, women and those who have less than $100,000 in investible assets.

“This is a concerning trend in Alberta,” added Turchansky. “It’s important to find the balance between dealing with the realities of today’s economy, which increase the need to hold cash, and volatility in the market, which is a normal part of investing. It’s important to stay calm. Don’t abandon your long-term strategy. Talk to an advisor, review your plan and make sure it’s the right strategy for you.”

Overall, Albertans’ view on the province’s economy seems to be improving. Of those surveyed, five per cent felt the economy is much better than it was six months ago, up three per cent from the previous Investor Beat. Meanwhile, 44 per cent felt the Alberta economy is much worse, down three per cent.

As far as the global economy, Albertans are slightly less pessimistic. Nineteen per cent said the global economy is much worse than it was six months ago, a five per-cent drop from the last Investor Beat. On the positive side, five per cent believed the global economy is much better, up from two per cent previously.

The Investor Beat survey polled 1,007 Albertans from April 11-18, 2016, and is considered accurate to within +/- 3.5 percentage points.

Click here for the complete Investor Beat survey.