Employment insurance, or what more properly used to be called unemployment insurance, is only partly about insuring people against temporary loss of work.
In certain parts of Canada and in certain industries, the program is institutionalized, permanent and part of the warp and woof of society.
EI disproportionately favours older workers in rural areas with seasonal industries such as tourism, fishing and lumbering. It functions much less well for young urban and immigrant workers. That’s because those in the older, rural, seasonal category get the minimum number of hours of work and then go on EI, while those in the second are not laid off as frequently.
The biggest provincial loser from the current EI system is Ontario, where only 35 per cent of the unemployed qualify. The biggest winners are the Atlantic provinces (100-per-cent qualification in Newfoundland, and over 90 per cent in New Brunswick and Prince Edward Island) and Quebec (slightly under 60-per-cent qualification).
Nationally, EI takes money from better-off provinces and redistributes it to those that are less well off. Within provinces, it sends money from better-off regions to poorer ones. And it shuffles money from those with occasional bouts of joblessness and transfers it to those who work part of the year and qualify. All told, EI costs the federal government about 8 per cent of what it spends each year. Changes to the program announced by the government Thursday won’t do much about any of this.
With a majority in hand, the Harper Conservatives are trying to bring about some modest changes to the system, tightening qualifications, especially for those who use EI repeatedly. The government is trying to define two concepts left vague in existing legislation – “suitable employment” and a “reasonable job search.”
The political result, you can be certain, in areas of traditionally entrenched high unemployment (and seasonal work) will be loud, furious and perhaps politically damaging.
In those parts, EI is what the Americans call the “third rail” of politics: Touch it and you die. Certainly the first Chrétien government learned that lesson when it changed the qualifying criteria for the program. In so doing, it offended the deep sense of entitlement with which EI was regarded in rural parts of Atlantic Canada, an entitlement the Liberals themselves had fostered with EI changes in the early 1970s.
By touching their own creation – regionally variable EI rates and qualifying criteria – the Liberals lost politically in Atlantic Canada. A prominent cabinet minister from New Brunswick, Douglas Young, went down. His seat in French-speaking Acadie-Bathurst went NDP and has remained in the orange column ever since.
Of the many anomalies and inefficiencies in EI, the Conservatives have tackled only one: the fact that repeat users sometimes don’t take available jobs. A few of these jobs – the government has exaggerated their number for public-relations purposes – are then filled by temporary foreign workers.
In effect, the government is forcing frequent EI recipients to look harder for work, travel farther to take a job (within limits) and take a job at a lower wage than they had been earning before. It’s a bit of tough love, if you like, that won’t be welcomed by those who will find the changes tough and without much love.
There are many rural areas (and not just in Atlantic Canada) where seasonal work is all, or just about all, there is. In these parts, EI is woven into the social fabric. Changing it will be seen as an assault on the community, a challenge to the integrity of those who live there and the end of a way of life.
Politically, Conservative MPs in areas with a significant number of EI recipients had better prepare themselves for a long, hot summer.