Canadians turn to the second-hand market amid tepid economic growth

TORONTO - When Amahl Arulanandam decided to get back into playing guitar in 2014, he turned to Kijiji.

The online classifieds site helped him score a Jackson guitar for $250 - a steep discount from the $600 he estimates it's worth.

See Full Article

Since then, Arulanandam has bought three bicycles using Kijiji. The first turned out to be a dud, but that hasn't deterred him.

"I make a reasonable amount of money but it's not a regular, fixed income," says the freelance musician.

"Anywhere that I can save money just to make sure that I'll have a float for later on, in case I have a dry month, that's always helpful."

The second-hand economy - which includes everything from used goods stores to classified websites to online communities where users can trade goods - provides consumers with an opportunity to save money on their purchases or earn a little extra cash by selling stuff they no longer need.

With the economy projected to grow at a tepid pace this year, some economists say the number of Canadians participating in this segment of the economy is likely to grow.

"In every downturn, there are always people that get harder hit that are looking for ways of trying to MacGyver a better quality of life with whatever they've got," says Armine Yalnizyan, a senior economist with the Canadian Centre for Policy Alternatives.

"And it doesn't always take money. You can spend less and live well, if you can figure out how to work with others who can trade stuff that you want."

According to a report sponsored by Kijiji released earlier this week, roughly 85 per cent of Canadians took part in some form of second-hand transaction last year.

The report, which polled 5,990 people online, estimates that the second-hand economy contributes as much as $36 billion to Canada's GDP.

The Marketing Research and Intelligence Association, the polling industry's professional body, says online surveys cannot be assigned a margin of error because they do not randomly sample the population.

While much of the second-hand economy involves purchasing goods outright, there is another component that doesn't involve money changing hands at all.

In online bartering communities like Bunz Trading Zone, popular amongst millennials, users swap their unwanted items for things that they need.

Emily Bitze started the Toronto-based community in 2013 when she was working at a vintage shop and found herself so stretched one day that she couldn't afford pasta sauce for her spaghetti.

"I lived paycheque to paycheque," Bitze recalls. "There were often times where I couldn't afford to actually buy food."

Bitze decided to create a Facebook group where she could trade goods with her friends. Since then, the online community has swelled to more than 30,000 members, and Bitze recently launched a smartphone app. A countrywide expansion and a U.S. launch are in the works.

Lindsay Tedds, a co-author of the Kijiji study and a professor at the University of Victoria, says most transactions in the second-hand economy represent new economic activity - purchases that wouldn't have happened otherwise. That means they aren't detracting from economic growth.

However, in some instances consumers who would have bought new goods are turning to the second-hand economy instead - a phenomenon that can further fuel the cycle of slow economic growth, says Yalnizyan.

"If they're buying used because it's something they need and can't afford it new, it will slow down the economy," Yalnizyan says.

Bunz partner David Morton says that isn't the millennial generation's problem to solve.

"We're going to let the economists sort that out," says Morton.

"Whoever is to blame for the current economic situation - it's not us. We've just entered the workforce. The people who have been working and voting and being a part of the system since before we were alive, they're the ones who put us in this position. We're just taking care of us."



Advertisements

Latest Economic News

  • Asian markets drop as investors look ahead to Trump speech

    Economic CTV News
    BEIJING - Asian stock markets were lower Monday as investors looked ahead to U.S. President Donald Trump's speech to Congress this week for details of promised tax cuts and infrastructure spending. KEEPING SCORE: Tokyo's Nikkei 225 index fell 0.9 per cent to 19,107.47 and the Shanghai Composite Index lost 0.5 per cent to 3,237.14. Source
  • Billionaire industrialist Koch leads fight to deregulate African-style braiding

    Economic CTV News
    PAWTUCKET, R.I. -- The billionaire industrialist Charles Koch and hair braider Jocelyn DoCouto have at least one thing in common. They are both part of a national movement to deregulate the business of African-style braiding. Source
  • What's in your chicken? CBC's Marketplace consumer cheat sheet

    Economic CBC News
    Miss something this week? We've got you. Here's this week's consumer cheat sheet. Get the Marketplace newsletter in your inbox every week. Sign up here. Inflatable mattress (prices) So, that bed you got for a bargain? That deal may be less dreamy than you thought. Source
  • Vatican stakes out copyright to Pope Francis' image

    Economic CTV News
    VATICAN CITY -- God's love may be free, but the Vatican says it has a copyright on the pope. Unnerved by the proliferation of papal-themed T-shirts, snow globes and tea towels around the world, the Vatican has warned it intends to "protect" the image of Pope Francis and "stop situations of illegality that may be discovered. Source
  • Is the Ivanka Trump brand boycott anti-feminist?

    Economic CBC News
    After Nordstrom dropped Ivanka Trump's fashion line this month, a Fox News host blasted women boycotting stores that carry the brand. In an opening rant on her show, Jeanine Pirro called the boycotters "loud, classless women" who were unfairly picking on a fellow female simply because they dislike her dad, U.S. Source
  • Last BlackBerry-designed phone with physical keyboard to hit stores in April

    Economic CTV News
    TORONTO -- Fans of BlackBerry's classic physical keyboard will have reason to celebrate when the last product designed in part by the former smartphone leader becomes available in April. The Waterloo, Ont.-based firm played a role in developing the KEYone, named for the return of the QWERTY keyboard that other smartphone designers have mostly long retired. Source
  • Final cleanup begins at Dakota Access pipeline protest camp

    Economic CTV News
    BISMARCK, N.D. -- The U.S. Army Corps of Engineers has moved into the evacuated Dakota Access pipeline protest camp to finish the cleanup started weeks ago by the Standing Rock Sioux Tribe. A Florida-based company has been hired to provide trash removal and environmental cleanup in the main Oceti Sakowin camp on the north side of the Cannonball River and the smaller Rosebud camp on the south side. Source
  • Appealing to millennials, Las Vegas gets e-sports arena

    Economic CTV News
    LAS VEGAS -- The arena has all the features that a professional sports venue needs: stands, warm-up areas for teams, massive screens for spectators and a broadcast platform for commentators. But what distinguishes this new Las Vegas arena is its dozens of video game consoles. Source
  • Warren Buffett says don't waste money on investment fees

    Economic CTV News
    OMAHA, Neb. -- Billionaire Warren Buffett wants investors to be wary of the high fees Wall Street routinely charges because of the damage they do to investment returns, and he emphasized his confident outlook in the U.S. Source
  • 'We always find a way': N.L.'s oil-dependent economy is hurting, but there is hope on the horizon

    Economic CBC News
    Dwight Ball, the affable pharmacist who has been Newfoundland and Labrador's premier for the last 15 months, said something remarkable Wednesday while swinging an axe through several hundred government jobs. "We're human, too. This impacts us," said Ball, who clearly has shown no relish for the more brutal parts of dealing with an oil-dependent economy during a collapse in petroleum prices. Source