There is good news and bad news for small retailers this holiday season.

The good news is 61 per cent of Canadian shoppers plan to do more in-store shopping this holiday season–a 10 percentage point increase from last year. The bad news is the effects of inflation mean 60 per cent of shoppers plan to lower their overall gift-buying budget.

These numbers come from a survey done by Equifax Canada. The same study also shows that personal debt is becoming more burdensome for Canadians as life gets more expensive. Forty-one per cent of people surveyed say they will spend less on the holidays this year because their debt is already too high–up five percentage points from last year.

Meanwhile, a mere 12 per cent say they will spend more this year than last. Whether or not someone is spending more or less has a lot to do with age. Twenty-three per cent of people between 18-34 say they will spend more during the holidays, while only four per cent of people over the age of 55 will increase their spending.

On the plus side, the survey shows more than half (57 per cent) are planning a budget for holiday spending.

“Whether you’re spending more or less, it’s very important to go into holiday shopping with a well thought out budget,” Equifax representative Julie Kuzmic said in a press release. “Inflation is adding pressure to the financial situations of Canadians. Preparing and sticking to a budget may help make those credit card bills a little easier to face in January.”

Small businesses are also feeling the pressures of inflation. The survey asked more than 300 business owners how they felt heading into the holidays. Only 25 per cent said they were more confident this year than last.

In 2021, Equifax asked small business owners what their big wish was, and 54 per cent said it was for customers to keep shopping at their stores. That number is now 72 per cent when Equifax asked the same question. This suggests small business owners are worried about losing customers.

“Small businesses only have so many options and flexibility to how they operate and typically run on razor-thin margins (especially during the first few years of operating). They have a limited number of staff, a limited number of suppliers that they operate with, and have a very fragile supply chain,” says Equifax’s Jeff Brown wrote in an email to Huddle.

“When we think about this in relation to the holiday shopping season, it’s clear that small businesses have a very limited set of tools to be successful, especially in a consumer market that is currently gravitating to spending less this season.”

Derek Montague is a reporter with Huddle, an Acadia Broadcasting content partner.