EDMONTON—A new survey shows that Albertans are faring worse than the rest of Canada when it comes to nonmortgage debt, despite recent growth in the economy.

According to BDO Canada Limited, who conducted the survey with the help of Ipsos, the average nonmortgage debt in Alberta is $24,700, which is the highest in the country.

The survey, released on Oct. 10, also found that 78 per cent of Albertans are under the burden of debt, with 25 per cent of that cohort being “so overwhelmed they don’t know what to do about it,” a news release for the report said.

Jonathan Day, an Edmonton-based accountant with BDO who does work around promoting financial wellness and literacy, said the results of the survey can be linked to the boom and bust of Alberta’s oil economy and Alberta’s young population.

But Day added he was surprised to learn that Albertans continue to struggle financially despite the province recently reporting a growth in employment rates. Michael Roberts, a business professor at MacEwan University, says the continued struggle is tied to the financial “hangover” that is still being felt following the collapse of oil prices in 2014.

“I don’t imagine household income [has] returned to boom levels,” Roberts said. “It could take five to 10 years to take control of a lot of that debt.”

According to the survey, 56 per cent of Albertans said their household income is just enough to cover their living costs, which is a bit higher than the national average of 52 per cent. As for retirement savings, 35 per cent of Albertans said they have none.

According to Day, the 2014 collapse became a “massive disruption” to the financial well-being of families who acquired a large amount of debt because they were previously able to afford it. After the collapse, unemployment rates rose across the province. They have since fallen, Rose said, but at a much slower rate than normal in Alberta.

Day said that people’s worries have shifted from not having a job, to having one that pays up to 50 per cent less than the income they became accustomed to, all while they continue to be burdened by debt.

“I think we absolutely should be concerned,” Day said of the results. A high average of debt, he said, puts the economy under major instability, as even the most minor of crashes may lead to households collapsing and people unable to move forward with their debt payments.

Other factors include growing interest rates, which have affected Canadians across the country, Day said, though the effects were felt harder in Alberta. Rose said he anticipates interest rates will continue to rise as the year wraps up.

Alberta’s younger demographic, compared to the rest of the country, is also a factor, Day said. According to Statistics Canada, the average age of Alberta’s population is 37 as of the 2016 census.

“We have more millennials, we have more Gen Xers, we have more young families,” Day said. “When oil was good, people want to flood into Alberta from other parts of the country where they may not have the same opportunities.”

Now, those younger Albertans will prove to be the most vulnerable if the province’s average debt continues to rise, Day said.

“They don’t have reserves to see them through a rainy day,” he said.

But Rose points to the fact that the average income in Alberta is 15 per cent higher than the rest of the country, which can drive the province’s debt average up. He added the good news is that Alberta’s younger demographic will ensure the debts will be paid, putting less overall strain on the economy.

“They have their whole lifetime to pay it off,” he said.

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Roberts said the results of the survey should reignite the conversation around thoughtful spending and proper saving methods, and encourage people to put off purchasing a new car or going on their next vacation until their debt is under control.

“People are just going to have to get a grip on it,” Roberts said.

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