Affordability

After household income per capita grew by 3.8% (+$1,781) in 2020, growth was not as robust in 2021 with an increase of only 0.6% (+$271), the lowest among benchmark cities. The reduction in pandemic-related benefits provided by the federal and provincial governments contributed to this slower growth. At $48,876 per capita, Halifax had the second-lowest income across benchmark cities, above only KCW¹($48,654).

Moreover, Halifax experienced the highest inflation rate across benchmark cities at 3.7%, 0.4 percentage points higher than the three cities that tied for second place at 3.3%. With higher growth in consumer prices and lower growth in income, Halifax’s purchasing power²declined by 3.2%.

Although the decline is in stark contrast to the 6.6% increase in purchasing power experienced in 2020, all other benchmark cities saw a drop in their purchasing power as well. Consumer price indexes by product groups are not available for Halifax, but Statistics Canada does publish these data at the provincial level. Between 2000 and 2021, consumer prices in Nova Scotia increased 50.6% (CAGR³of 1.9%).

Food and shelter saw price increases of 70.6% and 61.4%, respectively, over the same period. However, prices for clothing and footwear fell by 4.0%. Alcoholic beverages, tobacco products, and recreational cannabis had the highest price growth across all product groups at 177.2%.

Halifax’s poverty rate as measured by the share of the population with income below the Market Basket Measure (MBM)⁴threshold stood at 8.3% in 2020. Although this was the highest rate across benchmark cities, the decline in the rate between 2015 and 2020 (-9.9 percentage points) was the second largest across the cities. The MBM threshold for Halifax in 2020 was $46,527. Halifax’s MBM threshold grew by 6.3% from 2015 to 2020.

In contrast to the decline in the MBM poverty rate, the share of the population falling into the relative low-income category is trending upwards in some cases. From 2000 through 2019, the share of those ages 18 to 64 categorized as low income rose from 16.2% to 17.4% while the share for those 65 and older increased from 7.4% to 12.0%. The share for those under age 18, however, fell from 24.7% to 20.8%.

The average income for the top 5% of earners in 2019 was $152,400; the average for the bottom 50% was $17,200. The top 5% earned 15.0% of Halifax’s total income while 20.9% was earned by the bottom 50%.

Looking at more detailed income brackets, in 2020, the share of people earning $60,000 was more than 5 percentage points over 2015. There was also a decrease of 10 percentage points in those earning less than $20,000.

Child care is fundamental to a growing city. More affordable and accessible child care services make it easier for parents to work, and this boosts both the size of the labour force and household employment income. There is also a longer-term effect on the economy. High-quality child care builds a solid foundation for children as they pursue their education and eventually enter the workforce.

The Canadian Centre for Policy Alternatives (CCPA) assesses child care costs across 37 Canadian cities by three age groups: infants (<18 months), toddlers (18 months to 3 years), and preschoolers (> 3 years). According to the CCPA’s Game Changer report on child care in 2021, median monthly child care fees in Halifax are $996 for infants, $897 for toddlers, and $880 for preschoolers. These are the second-highest costs among benchmark cities for all age categories, behind only KCW. Costs in Halifax were up 4%, 5%, and 1% for infants, toddlers, and preschoolers, respectively, in 2021.

In July 2021 the federal and Nova Scotia governments signed the Canada-Nova Scotia Canada-Wide Early Learning and Child Care Agreement. This agreement calls for a 50% reduction in parent fees over 2019 levels by the end of 2022, with further declines to an average of $10 per day (or approximately $220 per month) by 2025-26.

The CCPA does project substantial reductions to median fees in Halifax in 2022 as a result of the new funding, but it estimates fees will be roughly 60% of 2019 levels rather than the targeted 50%. Halifax will remain the second-most expensive for all three child care categories across benchmark cities.

Many people feared that as income-support programs and debt deferrals related to COVID-19 came to an end in 2021, debt levels and delinquency rates⁵might sharply increase. However, both measures dropped even further.

Average non-mortgage debt per Halifax consumer ended 2021 at $20,916, down 7.4% from the previous year. This is the lowest level seen since 2016, but it remains higher than the Canadian and Nova Scotia provincial averages of $20,686 and $20,704, respectively.

Halifax’s delinquency rate declined by one-fifth from a year ago, ending 2021 at 0.93% -- the third-lowest rate across 9 major cities included in an analysis from Equifax Canada. Although above the 0.86% national average, Halifax’s rate is below Nova Scotia’s 1.11% rate. In fact, in 2021, Halifax saw both the non-mortgage delinquency rate and the mortgage delinquency rate hit all-time lows.

Consumer insolvencies⁶continued their decline for the second straight year in 2021 after experiencing years of steady increase. Of the 1,126 insolvencies, the lowest recorded, 475 were bankruptcies⁷and 651 were proposals⁸These figures represent declines of 19.4% and 15.0%, respectively, over 2020.