Canada – EI produces multi-billion-dollar surpluses, but only about a third of unemployed people can qualify

Even if you never use employment insurance, you pay into, he said. Someone who makes $60,000 a year, pays about $914 to EI. The program isn’t serving everyone it needs, but it constantly produces multi-billion-dollar surpluses. Why is it then, as Zon wondered, “contributing on paper to the federal budget balance” when “only about a third of unemployed people can qualify for our main insurance against unemployment.

“Twenty-five years ago it covered roughly 85 per cent of people,” he said.

EI is also set up to create regional inequalities because of the structural nature of work in our massive country (the fisheries, for example, long relied on EI to supplement workers incomes in the winter). That’s left Ontario especially hardest hit. Zon said in some areas, notably Toronto and Hamilton, only about one in five EI claimants receive it.

The program is meant to keep people from falling into poverty during short-term unemployment, which is good for the overall health of the economy. But when they don’t qualify, Zon explained, they turn to the welfare system, which often requires that people fall into poverty after selling assets to qualify.

Three ideas from Mowat to improve employment skills training:

1. Create a more supportive environment for Canadians who upgrade their skills, either through direct grants or even “payback clauses” to encourage private-sector employers to foot the bill;

2. Remove the requirement that a Canadian be eligible for Employment Insurance to receive many types of job training, including the Canada Job Fund;

3. Restructure program delivery so federal, provincial and municipal governments aren’t all responsible in different ways for different things, which creates a byzantine system that’s confusing for users.

Chosen excerpts by Job Market Monitor. Read the whole story at  Reframe Canada’s social safety net as its social architecture so we can rebuild it before it crumbles: report | National Post.