Canadians to spend more this holiday season, report finds

Recent trade uncertainty, climbing debt levels and rising interest rates don't seem to bedampeningholiday spirits among Canadian consumers, who plan to spend as much or more this season as they did last year, according to an annual report by accounting firm PwC.

The firm's holiday outlook released Tuesday found that consumers will spend an average of $1,563 this year,up 3.7 per cent from $1,507in 2017.

Not all of those dollars are going to things put under a tree or exchangednext to a menorah, though. The largest portion of the Canadian holiday spend will go to travel, $720,while gifts chew up $625 and entertainment, $198.

The data comes from anational survey of more than 1,000 Canadian consumers acrossgenerational groups, and could indicate greater consumer confidence than expected.

Myles Gooding, PwC'sretail lead in Canada, said Canadians areready to shop this season.

In fact, given trade issues have been resolved sincethe survey was conducted duringthe summer, Canadians' holiday budgets could get evenbigger than the report shows, said Gooding. That's in line with the overall health of the economy.

"The ongoing economic indicators continue to be in the positive direction for Canada overall," he said.

Relationship to debt is changing

Even high debt loads don't seem to be bringing about thriftier habits.

"When you look at the report, while debt is certainly rising, there's probably only about 19 per centwho are really concerned about it," said Gooding."The ability to carry on debt and still have confidence in the economy is becoming more of a newer normal nowadays."

Men are leading the increase in holiday spending this year, especially millennial dads 53 per cent plan to spend more than last year. On average Canadian men intend to spend $1,752 this year while women expect to part with $1,485.

Despite growing fondness for online retailers, 63 per cent of Canadian holiday shopping will be done in stores, the reportfound.

Goodingsays it's clear Canadians still like brick-and-mortarlocations.Even millennials,who tend to go online for price comparison, still like hands-on shopping providedretailers make it worth their while.

"The message here for the retailers is reallyto provide an experiential environment for the customer walking into the store. Sometimes this means reinventing a bit of retail," he said.

Goodingoffered upclothing companyFrank and Oak as an example. Itstarted out as an online operation but now has retail shops that incorporate barber shopsand espresso bars alongside their wares."This is what customers are looking for.

About one third of Canadians plan to do some cross-border shopping to score both deals and items they can't find at home.

Of those who head to the U.S. to shop, 49 per cent will buy apparel and 48 per cent electronics.

There could be brisk business in chewtoys and bespoke dogcollars this year, too.

Pet owners surveyed said they will spend an average of $65 on their pets over the holiday season.