Canadian consumers continue to binge on borrowing, but unlike us boorish Americans they’re still managing their debt responsibly.

According to the credit agency Equifax, Canadian consumer debt rose 6.9% year over year during the first quarter, to CAD1.5 trillion. The main drivers during the quarter were installment loans and auto loans, which were up 7.6% and 4.2%, respectively.

Nevertheless, Canadians’ stereotypical politesse even extends to paying their bills on time–the national 90-plus day delinquency rate remains at a low 1.12%.

Of course, historically low rates have also helped keep monthly payments manageable.

But even though the Bank of Canada’s (BoC) surprise January rate cut, which lowered the benchmark overnight rate to 0.75%, may have helped further spike the punch bowl, its effect was somewhat diluted.

With interest rates already at historic lows, banks and other lenders couldn’t necessarily afford to pass along the full 25 basis points of the BoC’s cut. That’s because there’s a certain point at which banks’ funding costs from sources such as deposits can’t go any lower, which means falling lending rates start to put pressure on profit margins.

Indeed, according to data gathered by the central bank, the prime rate and the conventional five-year mortgage rate have dropped by just 15 basis points from the levels that prevailed prior to January.

But Canada’s auto loan business has changed since the Global Financial Crisis, and that may be a key factor behind the jump in borrowing in this area. According to The Globe and Mail, the downturn wiped out leasing, and lenders stepped in to fill that void by offering loans with longer durations—up to eight years in some cases—in order to maintain the illusion of low monthly payments.

In fact, according to J.D. Power and Associates, loans of six years or longer accounted for 66% of auto loans in April. That’s down 3 percentage points from their peak last August, but it’s clear that this approach to financing is helping fuel auto sales, which hit a record high in May.

While policymakers find such trends worrisome from a financial stability standpoint, Canada’s economy has been very much dependent on consumer spending until the hoped-for transition to non-energy exports gains momentum.

And there is already evidence of what the economic shock from crude oil’s collapse might do to consumers as it spreads beyond the resource-rich provinces in Western Canada.

As Regina Malina of Equifax observed, “We’re starting to see delinquency rate increases in Alberta, and even more so in Saskatchewan. Oil prices and future economic outcomes are still being debated, but the average debt and consumer appetite for new credit are still on the rise. Careful monitoring is more important than ever at this point in time.”

At present, the country’s overall delinquency rate is near its lowest level since the Great Recession. In fact, the post-downturn low, at 1.09%, occurred during the fourth quarter, despite the turmoil in the energy sector.

Even during the atrocious first quarter, which saw gross domestic product contract by 0.6%, delinquencies rose by just 3 basis points.

However, as Equifax notes, bankruptcies and delinquency rates are lagging indicators, which means the underlying damage could take a while to reveal itself. We should know more in the next two quarters.

In the meantime, low interest rates will do a lot to help keep the situation in check.

But the biggest factor is ultimately the employment market. After all, when you no longer have a job, payments that were once manageable quickly become unaffordable.

After hitting a cycle low of 6.6% last October, Canada’s unemployment rate rose by two-tenths of a point in February, where it’s remained in the months since then.

Both April and May saw significant gains in full-time employment, though the number of full-time jobs is up by just 1.6% over the trailing year.

Meanwhile, unemployment rates in Alberta and Saskatchewan, the two provinces most exposed to the commodities crash, are up sharply over the past year, by 0.9 percentage points and 1.1 percentage points, respectively.

But the job markets were so strong there until recently that both provinces still boast unemployment rates that are well below the country’s average, even if both rates are rising rapidly.

The country’s overall employment situation is expected to only somewhat improve in the months ahead, based on Manpower’s survey of hiring intentions among 1,900 companies across Canada. Just 20% of firms are planning to increase their staff during the third quarter, down 1 percentage point from a year ago. But thankfully, only 5% expect to make layoffs.

So while things aren’t nearly as bad as they could be, this remains a challenging economic environment, with considerable uncertainty about the full effect of the oil shock.

And just as before, much of Canada’s near-term economic growth hinges on its neighbor to the south.

Growth expectations for both countries have declined in recent months. Canada’s economy is expected to grow by just 1.9% this year, well below the 2.5% growth the BoC has said is the minimum threshold to remove excess capacity.

And the U.S. economy is forecast to grow by 2.2% this year, though that jumps to 2.8% in 2016, which is within shouting distance of the long-term average.

Fortunately, these economic woes aren’t holding back the companies in our new Dividend Champions Portfolio, at least as far as dividends go. The vast majority of our companies–22 of 29–raised their dividends during the first quarter, with an average increase of 7.7%. That means we’re being well paid to wait for better times ahead.