HRSDC Funded Research Contradicts Key Argument For New EI Policy

According to today’s Globe, the government says that the major target of pending changes to EI is frequent claimants, who are disproportionately to be found in  the high unemployment regions.

This focus seems to reflect the common belief that supposedly “overgenerous” EI benefits stop some people from moving from high to low unemployment regions.

Interesting to note, then, that research commissioned by HRSDC finds that the EI program has almost no impact on inter-regional labour mobility. Here is the summary and link to the full paper, taken from the latest  EI Monitoring and Assessment Report.

22. Policy-Induced Internal Migration: An Empirical Investigation of the Canadian Case

Author(s): Kathleen M. Day, University of Ottawa, and Stanley L. Winer, Carleton University

Objective(s): This study investigates the influence of public policy on interprovincial migration in Canada.

Key finding(s) referenced in the report:

• The prime determinants of interprovincial migration were differences in earnings, employment prospects and moving costs.
• EI is not a barrier to mobility, as eliminating regional EI extended benefits and regional EI differences in qualifying requirements would increase the volume of migration by less than 1%.

Availability: This paper can be found through CESifo at http://www.ifo.de/portal/pls/portal/docs/1/1188434.PDF