Janice MacKinnon on EI
Janice MacKinnonâ€™s op-ed on Employment Insurance (EI) in Mondayâ€™s National Post read almost as if it had been written before the economic crisis. There was no mention of mass layoffs or rising unemployment, let alone proposals to enhance EI in response to these trends. Instead, she sees the biggest problem with EI as being the supposed drag on labour mobility created by benefit differences between regions.
The op-ed seems to exaggerate these regional differences and definitely overstates the relevance of labour mobility. It asserts, â€œOnly one in three of the unemployed in Ontario and the Western provinces receive EI, compared to eight in 10 in Quebec and the Atlantic provinces.â€ These fractions have gained significant currency.
For example, CBC News Tonightâ€™s Harry Forestell put them to Diane Finley, the minister responsible for EI. When she questioned these numbers, he retorted that they had the provenance of a former provincial finance minister.
MacKinnonâ€™s Policy Options article, from which her op-ed was drawn, cites a Caledon Institute commentary as the source of these figures. But that commentary does not itself provide a source for them.
The most recent Statistics Canada figures tell a less dramatic regional story. In June, there were 468,000 recipients of regular EI benefits out of 1,088,000 officially unemployed workers in Ontario and the western provinces. There were 335,000 recipients out of 504,000 unemployed workers in Quebec and the Atlantic provinces.
Therefore, EI coverage was 43% west of the Ottawa Valley versus 66% east of the Ottawa Valley. This disparity is significant, but not nearly as large as the alleged disparity of 33% versus 80%. If the disparity is smaller, then the implied disincentive to labour mobility is also smaller.
In any case, the main brake on inter-provincial labour mobility for most workers east of the Ottawa Valley is not EI, but speaking French rather than English. Furthermore, as I pointed out through the following letter printed in Wednesdayâ€™s National Post, labour mobility is not the issue anyway:
No province has a ‘labour shortage’
Re: Follow the Jobs, Janice MacKinnon, Sept. 14
Janice MacKinnon asks, “Why don’t more unemployed Canadians from parts of the country with high jobless levels move to provinces that are experiencing labour shortages?” She blames relatively more accessible Employment Insurance benefits in regions of high unemployment.
This question and answer are based on the false premise that some provinces have “labour shortages.” In fact, full-time employment has decreased and unemployment has increased in every province over the past year. Simply facilitating greater mobility would not help, given the lack of available jobs in all provinces.
The goal of Employment Insurance reform should be to improve benefits for the growing numbers of unemployed workers in every province. Achieving this goal through national standards, as the labour movement has long proposed, would also remove the supposed incentive to stay in high-unemployment regions.
Erin Weir, economist, United Steelworkers, Toronto
MacKinnonâ€™s Policy Options article, unlike her op-ed, does mention the desirability of national EI standards and/or extending the duration of benefits for long-tenured workers. Unfortunately, it also includes some hand-wringing about unidentified â€œinter-provincial trade barriers.â€