The Mowat Centre for Policy Innovation has been at the forefront of the debate around Employment Insurance (EI) reforms in Canada. The Centre has written numerous reports and analyses of EI and has been leading the call for changes.
The Toronto-based think tank says new changes to the EI program may have a greater impact on Ontario and western Canada than in Atlantic Canada. In an opinion piece, it suggests that “at an individual level, those most likely to be strongly affected by the policy change will be repeat users in extremely low unemployment rate regions, such as Alberta.”
This raises an interesting question. Do we expect government to look at big public policy changes through the lens of the individual or the community? It may be true that on an individual level, the proposed EI changes may cause problems for the seasonal construction worker in Alberta. But at the community and regional level it would be impossible to argue these changes are going to have a greater impact on Alberta compared to Atlantic Canada and Quebec.
According to the 2010 EI Monitoring and Assessment Report published by the Canadian Employment Insurance Commission there were 498,000 frequent EI claimants across Canada in 2010.
These are the workers that will be most impacted by the changes to the program. Under the new rules, after just a few short weeks in an EI claim they will have to take work at 70 per cent of their previous employment income level and in any ‘suitable’ job – not just a job in their field of expertise.
According to Statistics Canada, fewer than 7 per cent of all persons across Canada that claimed employment income in 2010 lived in Atlantic Canada. At the same time, however, Atlantic Canada made up 30 per cent of Canada’s frequent EI claimants.
Across the country, there were only 27 frequent EI claimants for every 1,000 persons claiming employment income in 2010 (498,000 out of the 18.4 million claiming employment income). In Newfoundland and Labrador the ratio was 187 frequent EI claimants per 1,000 persons claiming employment income.
The other three Atlantic Provinces ranked second, third and fourth out of the 10 provinces in the ratio of frequent EI claimants to those earning employment income. Quebec comes in fifth place.
To put that in a comparative perspective, There are 11.5 times as many frequent EI claimants in Newfoundland and Labrador than there are in Manitoba (as a percentage of those earning employment income) and there are 19 times more frequent EI claimants in New Brunswick compared to Alberta.
That’s not a typo. There were only 5.7 frequent EI claimants in Alberta per 1,000 persons claiming employment income in 2010 and there were 107.5 in New Brunswick.
What makes the problem even worse is that frequent EI use is predominately a rural phenomenon in Atlantic Canada and Quebec. We don’t have the frequent EI claimant data at the community level but we do know how many people collected EI income in 2010.
In Fredericton, there were only 142 persons claiming EI income per 1,000 with employment income in 2010. This was lower than the national average of 152 per 1,000. However, in non-CMA (census metropolitan areas)/CA (census agglomerations) New Brunswick, there were 373 persons collecting EI income per 1,000 with employment income. More than 37 per cent of all employment income earners in non-CMA/CA areas of New Brunswick also collected Employment Insurance income in 2010.
The Mowat Centre would be wise to come to Atlantic Canada and do a little more research into on-the-ground realities in the region. In New Brunswick, for example, decades of out-migration – particularly among young people in rural parts of the province - is leading to increasing shortages of workers in retail services, accommodation, food service and even transportation.
Under the old EI rules, seasonal workers in manufacturing, construction or primary industries would not have been required to take jobs in these other sectors. Now, under a strict interpretation of the rules, not only will they have to take these jobs but at as much as 30 per cent lower wages than they earned before.
The Mowat Centre concerns are valid. I argued for many years that the EI system needed to change and I think the government’s new approach is a potentially important first step. But to imply the new EI system is going to have a greater impact in Ontario or western Canada makes no sense.
David Campbell is an economic development consultant and columnist based in Moncton, New Brunswick. He also authors a daily blog on economic issues in Atlantic Canada which can be found atwww.davidwcampbell.com.