The overwhelming majority (94 per cent) of Canadian business leaders believe that housing should be the top priority in the upcoming federal budget, calling it the biggest risk to the economy, according to a survey released Wednesday by KPMG in Canada.
They expect the housing crisis will dampen economic growth this year, with nearly nine in 10 (87 per cent) saying the rising cost of living, driven largely by housing costs, is forcing their organization to pay more for labour and affecting their ability to attract and retain already-scarce talent, said the survey.
Caroline Charest
“The ripple effects from the high cost of housing and lack of supply are being felt throughout the economy,” said Caroline Charest, an economist and Montreal-based partner at KPMG in Canada. “New and young Canadians are being shut out from purchasing and are finding rentals scarce and costly. Those who were able to enter the market a few years back due to record low interest rates now face the risk of default when their rates reset at upwards of three times what they pay now. All this is weighing heavily on business leaders struggling to attract and retain key personnel and talent, particularly in urban areas that have witnessed the highest increases in the cost of housing and in regions where housing is scarce.”
- 94 per cent of business leaders at 534 small-and-medium-sized businesses (SMBs) say high housing costs and lack of supply are the biggest risks facing Canada’s economy and should be the top priority in the upcoming federal budget
- 87 per cent say the rising cost of living (driven largely by housing costs) is forcing their organization to pay more to attract and retain talent
- 87 per cent are budgeting for higher labour costs due to competition for talent, inflation, and the high cost of affordable housing
- 89 per cent say that solving the housing crisis will require public-private sector collaboration
- 81 per cent say the high cost/lack of affordable housing has hurt their ability to attract and retain employees
- 87 per cent expect inflationary pressures in Canada to persist until the housing shortage and high rents are dealt with
- 84 per cent say the high cost/lack of affordable housing is a greater threat/risk to the economy than inflation
Mario Toneguzzi
Mario Toneguzzi is Managing Editor of Canada’s Podcast. He has more than 40 years of experience as a daily newspaper writer, columnist, and editor. He was named in 2021 as one of the Top 10 Business Journalists in the World by PR News – the only Canadian to make the list. He was also named by RETHINK to its global list of Top Retail Experts 2024.
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