Hope in Hard Times: Financial Wellness in Canada Improves

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TORONTO--(BUSINESS WIRE)--Sep 10, 2025--

If you have found yourself doom-scrolling on social media or scanning headlines in your local newspaper, you may believe that the financial health and prospects of Canadians are at all-time lows. The more you scroll, the worse the situation appears to be – but things are not always what they seem.

The National Payroll Institute's 2025 Annual Survey of Working Canadians reveals that, contrary to the popular public narrative, there are reasons to believe that the financial health of Working Canadians may finally be improving after years of decline.

In fact, a cluster analysis of the 17th annual survey completed by Canada’s Financial Wellness Lab, based at Western University, reveals that, while workers continue to fall within one of three clusters – financially stressed, coping or comfortable - the proportion of financially stressed workers has actually decreased from 41 per cent in 2024 to 36 per cent in 2025. This decrease follows four consecutive years of concerning growth. Meanwhile, the share of those in the financially comfortable cluster increased from 28 to 30 per cent.

While financial wellness is a complex issue, the overall improvement in the financial health of working Canadians appears to be a result of a greater emphasis on saving. Fifty-one per cent of survey respondents reported trying to save more this year, up from 42 per cent in 2024. The share of Canadians who managed to save $10,000 or more in the past year also rose to 29 per cent, up from 23 per cent.

“It may be that the increased rates of savings that we’re seeing are a byproduct of the same headlines that suggest the financial health of Canadians should be floundering," says Peter Tzanetakis, President and CEO of the National Payroll Institute. "Filled with uncertainty rooted in the rising costs of living, and the impacts of tariffs on both job security and the economy, savings are one way that Canadians may be preparing for future challenges."

Gen Z Defies Social Media Narratives

Among the most prevalent and negative stories on social media related to financial wellness is the dire state of affairs for Gen Z.

Once again, the survey reveals that not everything on social media should be taken at face value. In reality, when compared to other Generations, Gen Z workers are holding their own and demonstrating proactive financial behaviours proven to improve financial wellness.

Surprisingly, the percentage of Gen Z (37%) workers who are in the stressed cluster is equal to that of Millennials (38%) and Gen X (37%), who are in their prime earning years. Gen Z also holds the second-highest share of workers in the financially comfortable cluster, at 32 per cent, just behind Boomers and surpassing both Millennials and Gen X.

“The comparatively strong results are an outcome of stronger proactive financial behaviours," explains Adam Metzler, Lead Researcher at Canada's Financial Wellness Lab and Associate Professor at Wilfrid Laurier University. "According to the National Payroll Institute survey, they are saving more now than last year and are focused on paying off debt — both of which have been consistently shown to be key determinants of financial health.”

According to the survey, Gen Z workers save an average of 11 per cent of each paycheque, higher than any other generation. And 30 per cent of Gen Z respondents reported saving $10,000 or more in the past year alone.

“It may be that Gen Z’s good savings habits are a product of spending a lower percentage of their income on housing,” adds Metzler. “For example, 44 per cent of both Gen X and Millennial respondents spend over 40 per cent of their monthly income on housing, but only 35 per cent of Gen Z do the same.”

Notably, only 26 per cent of Gen Z respondents expressed confidence that they will be able to afford a home in their desired area within the next five years.

70 Billion Dollars Lost to Financial Stress in Canada

While the survey results contain reasons for optimism, the problem is far from solved, as businesses across Canada continue to see financial stress impacting their bottom line.

Over half of all workers (51%) admit to spending at least 15 minutes per day thinking about their finances on the job, a notable increase from 2024 (45%). And six per cent now spend more than 90 minutes per day worrying about their finances. Nearly one in four admits that stress related to personal finances has impacted their workplace performance.

The result is $69.5 billion in lost productivity annually — a staggering increase of $15.6 billion from 2024 and $42.6 billion since 2021, when lost productivity stood at $26.9 billion.

"Faced with unprecedented challenges, the cost of financial stress is one that Canadian businesses simply can't afford to continue paying," adds Tzanetakis. "Focusing on improving the financial health of workers is something every employer should consider a strategic priority."

Beyond lost time, financial stress is tied to a host of workplace challenges, including decreased motivation at work (47%), strained relationships at work (28%), and causing workers to take time off (33%).

Practical Ways Employers Can Support Financial Health

Recognizing the toll financial stress takes on both business performance and employee well-being, employers can focus on implementing programs and strategies that support improved financial habits related to saving, spending and debt.

To help them do so, a variety of tools are available—including the National Payroll Institute’s Financial Fitness Evaluator for Business. This research-based resource uses the Financial Wellness Lab’s insights and algorithms to assess the overall financial stress levels within a workforce and guide employers toward targeted and effective interventions.

Other practical steps employers can take include:

• Encouraging employees to automatically allocate a portion of their pay to savings accounts—a simple process that payroll can easily facilitate.
• Investing in payroll expertise to avoid delays, which can be especially harmful to those who are already financially stressed.

"These may seem like simple steps, but the Financial Wellness Lab's analysis has consistently shown that moving from stressed to coping (or even comfortable) is possible – often in as little as one year," concludes Tzanetakis.

About the National Payroll Institute

The National Payroll Institute champions payroll in Canada as being vital to the health of businesses across Canada by setting THE professional standard of excellence and sharing critical expertise. We provide the knowledge and resources that more than 45,000 payroll professionals need to realize their potential, 1.4 million employers depend on for the annual payment of $1.35 trillion in wages and taxable benefits, and that governments rely on to receive $469 billion in statutory remittances to fund critical programs each year. The Institute's designations are recognized as the gold standard for expertise and professionalism, and the only such designations for payroll in Canada.

About Canada's Financial Wellness Lab

Canada’s Financial Wellness Lab, based at Western University, is dedicated to developing quantitative finance and data analytics solutions that help Canadian households strengthen their financial resilience. Financial wellness and resiliency are complex topics studied across many disciplines. To date, research has been limited by the inaccessibility of high-quality data, with much of it proprietary and often analyzed through a particular agenda. The Lab addresses these challenges by leveraging a broad range of granular historical and real-time data. Using advanced analytics and machine learning, our researchers examine these data sources to uncover new patterns and insights that have not previously been studied.

About the 2025 National Payroll Institute Survey of Working Canadians

The 17th annual National Payroll Institute Survey of Employed Canadians surveyed 2,320 working Canadians, with 75 per cent being full-time employees. The survey was conducted online using a panel methodology by Framework Analytics Inc. between May 6, 2025, and May 20, 2025. The survey is consistent with a margin of error of plus or minus 2 per cent 19 times out of 20; however, since a non-probabilistic methodology was used, a definitive margin of error cannot be expressed. The data was not weighted, as the sample aligns with Statistics Canada’s profile of employed Canadians regarding gender, age, and location.

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CONTACT: Media:

Keera Hart

Kaiser & Partners

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KEYWORD: NORTH AMERICA CANADA

INDUSTRY KEYWORD: SOCIAL MEDIA INFLUENCER OTHER PROFESSIONAL SERVICES GENERATION Z HUMAN RESOURCES GENERATION X FINANCE BUSINESS COMMUNICATIONS PROFESSIONAL SERVICES BABY BOOMERS MILLENNIALS PERSONAL FINANCE MEDIA CONSUMER DATA ANALYTICS

SOURCE: National Payroll Institute

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PUB: 09/10/2025 08:00 AM/DISC: 09/10/2025 08:01 AM

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