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Wednesday, December 17, 2003

Survey of Household Spending


New technology and shifting priorities are changing the way Canadian households spend their money, according to estimates from the 2002 Survey of Household Spending.

The proportion of the average household budget allocated to food and shelter remained largely unchanged from 2001. However, spending on transportation and communications increased, while the portion claimed by personal taxes fell for the second consecutive year.

Personal taxes accounted for an estimated 20% of the average household budget, down from 21% in 2001. Transportation claimed 14%, up slightly from 13%, while food represented 11% and shelter 19%, about the same as in 2001.

On average, households spent $60,090 in 2002, a 2.2% increase from 2001 after adjusting for inflation. This included an estimated $6,680 on food, $11,200 on shelter, $8,430 on transportation and $12,030 on personal taxes.

Two provinces reported average levels of household spending above the national average of $60,090 in 2002: Alberta at $67,730 and Ontario at $67,540. Newfoundland and Labrador continued to have the lowest provincial average ($47,970).

Transportation spending driven by vehicle purchases

Household spending on transportation in 2002 rose to an estimated average of $8,430, up 11% from 2001. This was due largely to a 14% increase in spending on the purchase of cars and trucks, which includes vans and SUVs.

Statistics Canada's Retail Commodity Survey noted that motor vehicle sales reached record levels in 2002, and that incentive programs and low interest rate financing played a role in this increase.

Note to readers

Data for this release came from the 2002 Survey of Household Spending. Data were collected by personal interviews conducted from January to March 2003 from a sample of more than 20,000 private households in all provinces. The survey gathered detailed information on spending patterns, dwelling characteristics, and household equipment in 2002.

For 2001, data were collected in the territories, but not for 2002. Therefore, for comparability, totals for Canada in 2001 in this release do not include the territories.

The average spending for a category is calculated for all households, including those with and without expenditures for the category. Sales taxes are included in average spending figures.

For the first time, an expenditure table with data adjusted to 2002 constant dollars is included in this release. This adjustment was done using the Consumer Price Index All-Items index. As in previous years, all other comparisons of expenditures in this release are not adjusted for inflation. However, the rate of inflation for selected items is included where it affects the analysis of year-to-year changes in spending. All figures in this release have been rounded.

To analyse the data by income level, households were divided into five groups, or quintiles, based on their income. Each quintile represents one-fifth of all households. Quintiles are created by ranking households in ascending order of total household income and partitioning the households into five groups such that the estimated number of households in each group is the same.

Average spending on gasoline, parts and other operating expenses rose 11% to $3,950. Respondents reported that spending on their private and public automotive insurance premiums went up 16% to an average of $1,070. Eight out of 10 households reported owning or leasing at least one car or truck.

Average spending on public transportation, which includes airline fares as well as city and interurban transit, increased 7% to $690.

Spending on high-tech: Majority of households had cell phones

For the first time, more than half of all Canadian households (52%) reported having a cell phone. The average household reported spending $260 on cellular services in 2002, up 25% from 2001.

Just over one-half (54%) of households reported using the Internet from home, up from 50% in 2001 and 42% in 2000. Over half of the households with Internet access reported using a high-speed connection (cable or high-speed telephone) in 2002, up from 41% in 2001.

There was a significant urban-rural difference in Internet access. More than one-third of urban households reported using a high-speed Internet connection, while only 5% of rural households had high-speed. Average spending on Internet services rose to $160 in 2002, up 25% from 2001.

DVD players and CD writers continued to soar in popularity. About 36% of households reported having a DVD player and 28%, a CD writer, compared with about 20% each in 2001.

Satellite television receivers were reported by 21% of households, up from 18% the previous year. Cable television use held steady at 67% of households.

Satellite TV was more widespread in rural areas. It was reported by over half of rural households, compared with only 16% of urban households. Average spending for satellite service rental jumped 31% to about $100 in 2002, while average cablevision service rental remained steady at $330.

In 2002, over 64% of all households reported owning a computer, continuing the upward trend from 60% in 2001 and 55% in 2000. The number of households reporting spending on new computer hardware has risen from 12% in 1997 to 18% in both 2001 and 2002.

However, spending on new computer hardware was down 10% in 2002 to an average of $230, which was 17% below the peak of $280 reached in 2000. This decline was mainly due to a steady decrease in price. According to the Consumer Price Index, computer prices in 2002 were down 18% from 2001.

Households spending more on health care and pensions

Households reported spending an average of $1,590 on health care, up 12%. This was due to an 11% increase in spending on prescription drugs, and a 13% increase in public and private health insurance premiums.

Households in Alberta reported the highest average spending on health care, at $1,990, followed by British Columbia at $1,850. Households in Newfoundland and Labrador reported the lowest average spending ($1,300), while Ontario was second lowest at $1,400.

Household spending on personal insurance and pension contributions, excluding registered retirement savings plans, grew 9% to $3,420, mostly due to increases in contributions to Canada and Quebec pension plans. Average RRSP contributions decreased 4% to $1,620 in 2002.

Jump in spending on tobacco products, games of chance

Spending on tobacco products rose 19% to an average of $730 in 2002. However, this largely reflects a 32% rise in the price of tobacco products, as measured by the Consumer Price Index.

In the last 10 years, the percentage of households reporting spending on tobacco has decreased from 47% in 1992 to 37% in 2002.

Net spending on games of chance increased nearly 18% since 2001 to an average of $310 per household.

Food, shelter, clothing account for over half of spending by lowest income households

For the purposes of this analysis, households were divided into five groups according to their income, with each group representing 20%, or one-fifth, of all households.

The one-fifth of Canadian households with the lowest incomes spent over 51% of their budget on food, shelter and clothing in 2002. Personal income taxes claimed 4% of their budget.

In contrast, the group of households with the highest incomes allocated about 28% of their budgets to food, shelter and clothing, while 28% went to personal income taxes. The proportions for both groups were similar in 2001.

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The one-fifth of households with the lowest incomes reported average annual spending of $20,220 last year, compared with $120,230 for the group with the highest incomes.

Households in the lowest quintile have fewer members on average than households in the highest quintile.

Nearly half of households heat with natural gas

Data for 2002 showed that about 49% of Canadian households used natural gas as their primary heating fuel, 32% used electricity, and 13% depended on oil heating. This varied from province to province, depending on availability.

However, the survey showed that the primary heating fuel also varied with household tenure. Households that rent their dwelling were twice as likely to have electricity as a primary heating fuel as households that own their dwelling.

Of the estimated 4.1 million households that rent, over 46% use electricity for heating, compared with only 24% of owners. More than 54% of the 7.6 million households that owned their dwelling reported natural gas as their primary heating fuel.

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Available on CANSIM: tables 203-0001 to 203-0018.

Definitions, data sources and methods: survey number 3508.

Two tables offering summary-level spending data are available free online in the Canadian statistics module. One presents data for Canada and the provinces and the other one for selected metropolitan areas. A third table, presenting data on dwelling characteristics and household equipment, is also available free.

A user guide (62F0026MIE2003002, free) presenting information about survey methodology, concepts, and data quality is available online. From the Our products and services page, under Browse our Internet publications, choose Free, then Personal finance and household finance.

Ten detailed tables are available at $134 per table. Of these 10 tables, five present detailed household spending data: Canada, provinces and selected metropolitan areas (62F0031XDB); Household income quintile, Canada and provinces (62F0032XDB); Housing tenure, Canada (62F0033XDB); Household type, Canada (62F0034XDB); and Size of area of residence, Canada (62F0035XDB).

The remaining five tables present data on dwelling characteristics and household equipment: Canada, provinces and selected metropolitan areas (62F0041XDB); Income quintile, Canada (62F0042XDB); Housing tenure, Canada (62F0043XDB); Household type, Canada (62F0044XDB ); and Size of area of residence, Canada (62F0045XDB).

Custom tabulations are also available.

For more information about the Survey of Household Spending, or to enquire about the concepts, methods or data quality of this release, contact Client Services, Income Statistics Division (1-888-297-7355; 613-951-7355;

Average household expenditure and budget share (2002 constant dollars)1


  Average Expenditure Share of Budget Average Expenditure Share of Budget Average Expenditure Share of Budget
  2000 2001 2002
  $ constant % $ constant % $ constant %
Total expenditure 58,310 100.0 58,770 100.0 60,090 100.0
Personal taxes 12,590 21.6 12,490 21.3 12,030 20.0
Shelter 10,780 18.5 10,980 18.7 11,200 18.6
Transportation 7,940 13.6 7,770 13.2 8,430 14.0
Food 6,520 11.2 6,580 11.2 6,680 11.1
Recreation 3,320 5.7 3,530 6.0 3,540 5.9
Personal insurance payments and pension contributions 3,290 5.6 3,190 5.4 3,420 5.7
Household operation 2,640 4.5 2,680 4.6 2,780 4.6
Clothing 2,470 4.2 2,450 4.2 2,450 4.1
Household furnishings and equipment 1,630 2.8 1,690 2.9 1,790 3.0
Health care 1,420 2.4 1,450 2.5 1,590 2.6
Tobacco products and alcoholic beverages 1,280 2.2 1,340 2.3 1,480 2.5
Gifts of money and contributions 1,370 2.3 1,290 2.2 1,440 2.4
Education 870 1.5 920 1.6 930 1.5
Miscellaneous expenditures 870 1.5 880 1.5 900 1.5
Personal care 780 1.3 980 1.7 830 1.4
Games of chance (net) 270 0.5 270 0.5 310 0.5
Reading materials and other printed matter 290 0.5 280 0.5 290 0.5
1The All-items CPI has been used to adjust all 2000 and 2001 spending components.

Average household expenditure by province


  Total Food Shelter Clothing Transportation Personal Taxes
  $ current
Canada 60,090 6,680 11,200 2,450 8,430 12,030
British Columbia 60,600 6,770 12,380 2,320 8,550 10,950
Alberta 67,730 6,790 11,720 2,630 10,240 14,080
Saskatchewan 51,370 5,450 8,790 2,030 7,420 9,870
Manitoba 53,130 6,040 9,180 2,060 7,290 10,280
Ontario 67,540 7,000 13,280 2,740 9,290 13,870
Quebec 51,210 6,610 8,820 2,240 6,860 10,570
New Brunswick 50,040 5,840 8,050 2,020 8,010 9,140
Nova Scotia 51,240 5,760 9,010 1,980 8,150 9,180
Prince Edward Island 48,070 5,990 8,010 2,030 7,670 7,920
Newfoundland and Labrador 47,970 6,120 7,380 2,420 7,800 8,230

Average expenditures on major spending categories by income quintile


  Lowest quintile Second quintile Third quintile Fourth quintile Highest quintile
  Less than $23,470 $23,470 to $40,999 $41,000 to $60,269 $60,270 to $88,239 $88,240 and over
Food 3,500 5,060 6,610 7,870 10,370
Shelter 6,150 8,250 10,470 13,220 17,930
Clothing 860 1,430 2,100 2,930 4,930
Transportation 2,440 5,510 8,010 10,210 16,000
Personal taxes 770 3,580 7,970 14,040 33,770
Total spending 20,220  35,630  52,630  71,740  120,230 

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Date Modified: 2003-12-17 Important Notices