TORONTO — A new report says Canadian consumer spending has grown across income groups, but only those in the top 20 per cent of earners saw their income growth fully match and support their higher spending.

The Boston Consulting Group report looked at household spending and income growth between 2021 and 2025.

It says that outside of the top 20 per cent, households covered their increased spending by relying more on savings, rising portfolio values and borrowing.

“For the middle 60 per cent of earners, the traditional bedrock of commercial demand, income growth covered just 57 cents of every dollar of new spending,” the report said.

“The lowest 20 per cent covered almost none of it.”

The report added spending on services drove most of the growth, including financial services tied to borrowing and asset-linked fees, while real spending on essentials was flat and purchases of cars, furniture, and appliances fell.

It noted the middle 60 per cent are still spending, but their savings and balance sheets are moving more in the direction of the bottom 20 per cent than the top 20 per cent.

“The question is whether their spending starts to follow suit,” it said.

The report says there’s no longer a “single average consumer” for businesses to target, which means leaders need to build growth plans around a more uneven, financially constrained consumer.

Middle-income consumers may become more selective and deliberate about purchases and credit conditions will matter more.

“Asset gains have supported confidence, but much of that wealth sits in homes and other illiquid holdings, creating friction for discretionary purchases. If higher oil prices bleed into broader inflation, consumers may struggle to keep up,” the report said.

This report by The Canadian Press was first published July 14, 2026.

The Canadian Press