The crisis in Europe is weighing on the already-weak confidence in the economies of both Canada and the United States, with consumers increasingly worried about job prospects in both countries.
In Canada, that confidence fell back in June to levels not seen since January, "a reflection of the uncertainty facing Canadian and global economies," the Conference Board said in a report Tuesday.
"Negative opinion about the labour markets has risen to worrisome levels and is the primary cause behind the national drop in confidence this month," it said.
The board’s survey of consumer sentiment — taken between June 7 and 18 — showed a drop of 6.8 points to a reading of 74, as confidence declined in all parts of the country. Before the recession, the main indicator ranged between 95 and 105.
For June, only 13.9% of respondents said they expected job creation in the next six months, down 3.8 points from May and the lowest level since the first half of 2009 when the economy was just beginning to pull out of recession.
Pedro Antunes, the board’s director of forecasting, noted the Ottawa-based think tank looks for "intangible" information on income, employment and other trends.
"That’s a pretty good indicator for consumer spending . . . and how it impacts on future consumption. So when we see a decline, it worries us," he said.
"Consumers in general are very attuned nowadays to the fact that the external environment can have such as a big impact and repercussions on our own economy. I think they’re concerned about what we’re hearing in the media about what is going on in Europe, et cetera," Antunes said.
Both Canada and the U.S. have struggled to maintain inconsistent job creation this year.
After a weak start to 2012, Canada reported two massive back-to-back monthly gains before easing to more moderate growth in May. The U.S., meanwhile, got off to a good start this year, but employment gains have since been disappointing.
