The Consumer Price Index increased 2.9% year over year in May, an uptick from 2.7% in April. Conversely, the overall inflation rate has been on a general downward trend since its peak in June 2022.
Though it’s a relatively small share of the basket of goods and services, one category in particular has been doing its part to help keep inflation in check: clothing and footwear. In fact, any year-over-year price change has stayed under the headline inflation rate in every month over the past four years.
On a cumulative basis, price changes from May 2020 to May 2024 in a few key categories look like this: all items (+18.7%), transportation (+24.5%), owned (+23.4%) and rented (+22.9%) accommodation, and food purchased from stores (+22.5%). Clothing and footwear? A modest 3.8% increase over the same period.
COVID-19 pandemic and seasonal effects
As more households stayed home through the first wave of the pandemic, there was less of a demand for clothing and footwear alongside restrictions and closures affecting in-person shopping, and prices steadily declined on a year-over-year basis until the spring of 2021.
Any price increases have been modest since then, even as restrictions loosened and Canadians looked to update their wardrobes for the return to school, the office, and other in-person activities.
With Black Friday and other holiday shopping as a contributing factor, there have been minimal year-over-year price increases for clothing and footwear in November and December from 2021 to 2023.
Household spending
On an unadjusted basis, Canadian households spent $11.4 billion on clothing and footwear in the first quarter of 2024—this translates to about $279 per person, according to population estimates. Spending on a per-person basis has declined steadily over the last three quarters.
The $18.9 billion, or $466 per person, in clothing and footwear expenditures in the fourth quarter of 2023 reflects a holiday-related bump in spending. A similar pattern was observed in the same quarters from 2020 to 2022.
Annually, total household spending on clothing and footwear reached $60.3 billion in 2023, up from $58.2 billion in 2022, $48.6 billion in 2021, and $41.8 billion in 2020.
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