Government Changes to EI Program Hurting Workers

OTTAWA, ONTARIO--(Marketwire - Dec. 7, 2012) - The Conservative government's ill-conceived changes to the Employment Insurance system earlier this year have already turned sour, says Canadian Labour Congress President Ken Georgetti.

"The government used its giant omnibus budget bills to force through a number of changes to the EI system and it did so without consulting stakeholders," Georgetti says. "The results have been shockingly bad."

Georgetti was commenting on the release by Statistics Canada of its Labour Force Survey for November 2012. There were 1,369,700 unemployed Canadians in November and the unemployment rate was 7.2%. In the 15 to 24 age group, unemployment stood at 14.0 % and 47.5 % of young workers are employed only part-time.

Georgetti says unemployed workers are being forced to wait longer to have their EI claims processed because of changes made by the government. "They have cut back on the number of staff handling EI claims and that is causing a backlog," he says. "It's going to get even worse because the government is replacing the 700 part-time referees and umpires who handled EI appeals with just 39 full-time referees. This is going to hurt unemployed Canadians."

Georgetti adds that the government also made changes to a successful pilot project called Working While on Claim, which had allowed EI claimants to earn more money without having it clawed back. "The pilot project provided an incentive for unemployed workers to take available temporary or part-time jobs while they looked for new full-time work," Georgetti says. "For some reason the government made changes that were detrimental to these workers. Not surprisingly, there was a backlash and the minister was forced to back pedal."

Georgetti says negative changes to the EI system are being made at a time of sluggish economic growth and poor prospects in the months to come. "The EI system is ill prepared to serve Canadians who have lost their jobs and others who will do so this winter. The government has refused to consult and its labour market policies are a mess."

Quick Analysis from CLC Senior Economist Angella MacEwen

Employment rose by 59,000 in November, mostly in private sector, full-time work. This is better than predicted by most economists given Canada's recent slowdown in economic growth. Taking a longer view, the unemployment rate in November 2012 is only 0.3 percentage points lower than November 2011, and the same as it was in September 2011.

While the official unemployment rate fell in November 2012, the real unemployment rate increased. This measurement includes discouraged searchers and some involuntary part-timers. The real unemployment rate rose from 9.3% to 9.5% for those 15 years of age and over, and from 17.7% to 17.9% for youth aged 15-24.

The Canadian Labour Congress, the national voice of the labour movement, represents 3.3 million Canadian workers. The CLC brings together Canada's national and international unions along with the provincial and territorial federations of labour and 130 district labour councils. Web site: www.canadianlabour.ca Follow us on Twitter @CanadianLabour.