In an Abacus Data national survey, 67 per cent of respondents agreed that the cost of living where they live is the worst they remember.
These days nobody’s loving their grocery bill. According to Statistics Canada, in September the price on coffee was up 41 per cent, beef up 17.4 per cent, nuts and seeds 15.7 per cent and fruit juices and confectionaries were up more than 10 per cent. Part of the blame for some increases is climate change. Drought and flash flooding in Brazil and Vietnam caused coffee prices to spike globally, and drought caused increases in animal feed prices, driving up the cost of beef.
In an Abacus Data national survey published Dec. 15, 2025, 67 per cent of respondents agreed with the statement that the cost of living where they live is the worst they remember. That means a slightly more than two-thirds of Canadians are feeling the pinch.
Interestingly, the numbers broke down a little differently when viewed through a partisan lens. Liberals agreed with that statement 58 per cent of the time, while Conservatives agreed 75 per cent of the time. But what everyone agrees upon is that grocery prices are the greatest inflationary concern. What few notice is that energy prices have decreased this year, according to StatsCan. Canada’s Consumer Price Index for November 2025 shows prices have risen only 2.2 per cent over the same period last year.
Everyone needs to eat
That’s not scary inflation. So why do we feel there’s an affordability problem? Probably because prices at grocery stores went up 4.7 per cent and everybody needs to eat.
Brigitte Boulay started working for the government at age 21 doing web design for NSERC and, before that, the CRTC. She retired two years ago.
“[I] worked my butt off and retired with a very nice pension and benefits,” she says. “I should be on easy street, right? No. [I have] the best pension a person could have and more than half is taken up by rent.”
In her free time, Boulay started a homeless outreach organization called Shadow Ottawa 10 years ago. These days with her rent topping $2,000 a month, she says she meal plans based solely on what is on sale. She used to buy pairs of socks weekly to give out to panhandlers, but that’s no longer affordable for her.
“I can’t do that anymore,” Boulay writes. “It hurts me that I can’t do what I used to. But what will I take away from myself and my family to be able to give?” Economist Tim Sargent is a senior fellow and director of the Domestic Policy Program at the Macdonald-Laurier Institute.
“The [consumer] price index itself of course is creeping up, but the inflation rate is roughly stable,” Sargent says. “Since before the pandemic we’ve had a very significant run up in prices, and prices have gone up about slightly more than 20 per cent.”
Sargent says that since 2019, inflation around the pandemic spiked, but that things are getting back to where they’re supposed to be. Over that six-year period, two per cent inflation should have resulted in a 12 per cent total rise in prices.
“People’s perceptions tend to be based more on the prices they encounter most frequently. And that means grocery stores,” Sargent says.
“Clothing prices, footwear prices are actually down 3.6 per cent.” According to StatsCan, Canada’s real GDP per capita grew by 6.2 per cent between the third quarters of 2015 and 2025 (average annual growth rate of 0.61 per cent). In comparison, it grew by 5.4 per cent between the third quarters of 2005 and 2015 (average annual rate of 0.53 per cent.)
Economy is relatively resilient
Despite Trump and a pandemic, our economy is so far weathering the storms quite well. “So far, we have avoided a recession,” Sargent adds. “We’ve had decent employment growth to close out the year and wages are growing at a decent pace. Wages are growing faster than prices and have been for the last three years.”
“Canada’s economy is hanging in there after the first year of Trump and his trade war and all the uncertainty that it’s [caused],” says Jim Stanford, a Canadian economist, author, founder of the Progressive Economics Forum and director of the Centre for Future Work. “And frankly, I’m surprised that we haven’t had a recession. And the fact that we haven’t is a good reminder that our economy is actually quite diverse and quite resilient in many ways.”
The costs of rent, housing and food have all skyrocketed, which disproportionally affects people on the bottom end of the economic ladder, especially Gen Z as well as pensioners on fixed incomes. Also, if you’re employed in the steel, automotive or forestry industries, you may have experienced layoffs due to Trump’s sectoral tariffs.
“But in manufacturing as a whole, there are more people working today in Canada than there were a year ago,” Stanford adds, praising the wage gains that strong unions have recently managed to pry from their employers.
Gatineau’s Marc Fonda retired two years ago at age 60. Despite the fact that his wife is still working full time, his pension from 35 years with Aboriginal Affairs and NSERC is barely making ends meet during these tough times.
“I get most of my food at Giant Tiger now or Food Basics,” Fonda says, bemoaning having to shop for his family at discount grocers. “I pretty much avoid the regular grocery stores because of their prices, and when I do go, I’m kind of shocked at how much they actually want.”
Budget hit disability pensions
While Budget 2025 included a 2.7 per cent CPI-based increase for federal retirees in 2025, and a 2.6 per cent rise for CPP benefits, the budget also targeted RCMP disability pensions for CPI-only indexing, effective by January 2027. Previously those disability pensions were calculated by their wages as employees. By switching to CPI, the pensioners may lose compound interest accrued by that higher amount and that could take thousands out of the pockets of people who were disabled by their service to Canada.
Patrick Imbeau is the senior adviser on retirement security for Federal Retirees. He thinks the government’s argument that it was just trying to change to a system where all pensions are calculated the same way is specious.
“That’s what they’re arguing,” Imbeau says. “But it’s nonsense because they didn’t change how the veterans get it.” Another issue that riles Imbeau also riles James Infantino, a pensions and disability insurance officer for the Public Service Alliance of Canada. Both men are concerned that the budget is intending to raid the government pension’s “non-permitted surplus” like it did last year to the tune of $1.9 billion, moving it from the Public Service Pension Fund to the Consolidated Revenue Fund. Contributors are supposed to be consulted on where that money goes, and they haven’t been.
“In my opinion,” Infantino says, “they’re using that surplus in the pension fund to finance their reduction of the workforce and their fiscal difficulties.”
The budget said the government planned to cut about 16,000 public service jobs by 2028−29, with a larger goal that by 2029, there be 40,000 fewer public servants than were employed in 2024.
Imbeau says that while Federal Retirees supports early retirement for frontline workers, big early retirement incentive programs are normally paid for out of the employer’s budget, not their employees’ pension surplus.
“Our members and their contributions to their pension paid for the early retirement incentives for the government,” Imbeau says. “So their own contributions are paying for them to get an early retirement, to get to be forced out of their jobs.”