ALF V1

EI: It should be there when you need it! (An Analysis of Employment Insurance in Alberta)

As the current recession continues, Canadians across the country are discovering that their insurance system - Canada's Employment Insurance (EI) system - isn't delivering on its promise. Significant changes must be made to EI to make it into the insurance plan it should be - one that protects those workers who pay into it from suffering the temporary deprivations that come with layoffs.

In other words, same song, different day.

Ottawa has been all but paralyzed since the 2004 federal election, which marked the beginning of a streak of ineffectual minority governments.
The business of governing Canada has nearly stalled as political parties focus on Machiavellian backroom plots to tighten their grip on power.
This time, Ignatieff is threatening to topple Harper over changes to Employment Insurance benefits and force a fall election.

Last spring, he forced Harper to form a committee made up of Grits and Tories to examine what to do with EI to help the 250,000 Canadians who've lost their jobs.

But instead of coming up with quick solutions that both sides can agree on, the committee degenerated into partisan bickering and back stabbing.

The Liberals want to level the playing field by removing all regional differences to EI eligibility. Up to now, claimants in places like Quebec and the Maritimes haven't had to work as many weeks as westerners or Ontarians -- where jobs are more plentiful -- in order to qualify for benefits.

But the Tories argue a 360-hour (roughly nine-week) eligibility threshold -- replacing the patchwork of 58 thresholds across the country -- would cost a whopping $4 billion annually.

The Liberals counter the Tories have grossly inflated the numbers to make their rivals look spendthrift. And, the Grits add indignantly, the Tories' cost analysis was a private document, commissioned to embarrass the Liberals.

While all this skullduggery carries on in Ottawa's halls of power, another 45,000 people lost their jobs across Canada.

The national unemployment rate sits at 8.6%, the highest in 11 years. Since last October, 436,000 jobs were lost, almost two-thirds from Ontario manufacturing. Alberta is doing a little better than the nation, but our unemployment rate, at 7.2%, is still the highest since 1996.
Gil McGowan, head of the Alberta Federation of Labour, says there's no time to waste on fixing EI.

"Unemployed workers need help now, not six months or a year from now," he told The Canadian Press.

Economists warn that the very nature of the Canadian economy is changing and workers' skills must change with it.

"No one said it was going to be a smooth recovery and especially not for employment," warned BMP Capital Markets' Doug Porter.

That makes EI and retraining programs an even more critical part of getting the economy back on the rails.

Canadians don't need another federal election. We've already had four this decade. And we don't need politicians using the economic crisis to score cheap political points against their rivals.

Canadians do need leadership. We need politicians who will set aside their own ambitions and find a way to work together on getting us out of this recession.

The sooner, the better.

Calgary Sun, Mon Aug 9 2009
Byline: Andrew Hannon

Alberta's unemployment rate rose to 7.2 per cent in July--a high not seen since June 1996, said Statistics Canada, which released unexpectedly grim labour market news Friday.

Canada lost 45,000 jobs--more than feared. Most economists were predicting 20,000 job losses in July.

Alberta lost 3,700 jobs compared to June, while the province's labour force increased by 5,600 in July as jobseekers moved to the province.
The number of full-time workers fell by 11,900 in Alberta; those working part-time increased by 8,100-- another sign economists say points to a weakening labour market.

"The current weakness in conventional oil and gas drilling, as well as the sharp retrenchment in construction and manufacturing activity, has left many companies no choice but to cut payrolls," said ATB Financial senior economist Todd Hirsch.

Job losses in Alberta will only get worse in the next few months, he predicted.

"Labour indicators ... are well-known to lag conditions in the overall economy. So even if the recession appears to be losing its grip, we don't expect the jobs market to reach a bottom until sometime in the fall or early winter."

Premier Ed Stelmach is confident oil and gas drilling incentives introduced this year will keep some Albertans from joining the unemployment ranks.

"The numbers are increasing more than originally predicted, and it's very concerning to me," he said.

"But I can assure all Albertans that we will maintain all the programs that are necessary to look after those who not only lost their jobs, but look at how we also can get them back into the workforce."

Alberta's unemployment rate could see improvement in September when many jobseekers leave the labour market for school or training, said Sally Stuike, a spokeswoman for Alberta Employment and Immigration.

"We are hopeful and optimistic that the jobless rate here in Alberta will improve," she said, noting the latest statistics at least show an increase in part-time jobs.

As well, the overall job picture wasn't bad in all parts of Alberta. The Lethbridge-Medicine Hat area's unemployment rate remained unchanged from June to July at 5.5 per cent. The Banff-Jasper-Rocky Mountain House area remained at 5.9 per cent. Wood Buffalo-Cold Lake's jobless rate actually declined to 5.4 per cent in July from six per cent a month earlier.

Compared to the same time a year earlier, there were 51,100 more people in Alberta's labour force--an increase the provincial government and economists attribute to an influx of people from other parts of Canada.

Meanwhile, since July 2008 Alberta has shed 26,100 jobs.
Between June 2009 and July 2009, finance, insurance, real estate and leasing sectors lost 7,600 jobs. Accommodation and food services lost 4,600 jobs in the same period.

Third lowest
Alberta maintained Canada's third-lowest jobless rate, behind Saskatchewan at 4.7 per cent and Manitoba at 5.2 per cent.
But since last fall, Alberta has been the hardest hit by job losses, said one economist.

"While the national jobless rate has climbed by 2.3 percentage points since the onset of the recession in October 2008, unemployment has surged the most in Alberta (a gain of 3.5 percentage points), Newfoundland (plus 3.3), British Columbia (plus 2.6) and Ontario (plus 2.6)," said Pascal Gauthier, an economist with TD Bank Financial Group.
The national unemployment rate remained flat in July at 8.6 per cent as some jobless stopped looking for work, the federal agency said. The country lost 45,000 jobs full-and part-time jobs in July.

"The current recession's job loss tally now sits at 414,000, or 2.4 per cent, and keeps inching closer to that experienced in the early 1990s recession (3.3 per cent)," Gauthier said.

"No one said it was going to be a smooth recovery, and especially not for employment," said Douglas Porter, deputy chief economist with BMO Capital Markets, which had been expecting something in the range of 30,000 job losses in July.

"The underlying picture still looks quite soft, and there's little sign here that the economy is quickly turning the corner."

Most job cuts Canada-wide were in the accommodation, food services and construction sectors, while the retail and wholesale trade sectors added workers.

Seven per cent
In Edmonton, the unemployment rate inched up to seven per cent in July, up from 6.5 per cent in June. Calgary's rate also rose, to 6.9 per cent from seven per cent. The economic region in Alberta with the highest unemployment rate was Athabasca-Grande Prairie at 8.4 per cent; the lowest was Wood Buffalo-Cold Lake at 5.4 per cent.

Alberta's latest jobless increase prompted Alberta Federation of Labour president Gil McGowan to call on provincial and territorial leaders to pressure Ottawa for swift reform of the national employment insurance system.
"Albertans are losing jobs at a faster pace than workers in most other provinces," McGowan said. "But the system that is supposed to provide a safety net is failing us miserably. Only about 40 per cent of Alberta's unemployed are getting EI benefits --the lowest rate in the country."

The AFL and other labour groups want a uniform system of EI eligibility to replace the current system that requires people to work different numbers of hours to qualify for benefits depending on which region of the country they live.

"We think it's nothing short of a scandal that a prime minister from Calgary continues to drag his feet when it comes to EI reform, even when Albertans are the ones who are being the most discriminated against."

Edmonton Journal, Sat Aug 8 2009
Byline: Bill Mah

REGINA-As Alberta's unemployment rate soars to levels not seen since the recession of the early 90s, the need for fundamental reform to Canada's Employment Insurance system becomes even clearer and more urgent, says the leader of Alberta's largest labour organization.

"Albertans are losing jobs at a faster pace than workers in most other provinces," says Gil McGowan. "But the system that is supposed to provide a safety net is failing us miserably. Only about 40 per cent of Alberta's unemployed are getting EI benefits - the lowest rate in the country. And even when Albertans do receive benefits, they're eligible for fewer weeks than workers in other provinces. This kind of discrimination needs to end."

McGowan and other labour federation leaders are in Regina this week to lobby the Ed Stelmach and other provincial and territorial premiers as they gather for their annual premiers meeting.

The labour leaders' campaign for EI reform took on an increased sense of urgency today as the latest official unemployment numbers were released.

Figures released this morning by Statistics Canada show that Alberta lost another 9,300 jobs in July, bringing the province's total of net-jobs lost since October 2008 to 75,600. As a result, Alberta's official unemployment rate has jumped to 7.2 - the highest it's been since 1995.

Alberta actually lost 11,900 full-time jobs in July - but this was offset somewhat by an increase in precarious part-time work. The province's unemployment rate has now nearly doubled in the past 8 months (from 3.7 per cent in October 2008 to 7.2 per cent today).

"The employment picture in Alberta is more dismal than it's been in years - and despite happy talk from politicians and business leaders, it's continuing to get worse," says McGowan. "That's why we're calling on the premiers and federal government to fix our country's broken EI system immediately. Unemployed workers need help now, not six months or a year from now."

The AFL, other provincial and territorial labour federations and the Canadian Labour Congress (CLC) are calling for a uniform system of EI eligibility to replace the current system that requires people to work different numbers of hours to qualify for benefits depending on which region of the country they live in. The labour movement is also calling for increases to benefit levels and to the length of time that unemployed workers can collect benefits.

"It shouldn't matter if Canadians lose their jobs in Calgary or Cape Breton - people who have lost their jobs should get the unemployment benefits they've paid for," says McGowan. "The best way to help Canadians weather this economic storm and boost the broader economy is to put money in the pockets of those who have lost their jobs. That's why we need EI reform now. The system isn't delivering on its promise - and Canadians are suffering needlessly as a result."

-30-

For more information call: Gil McGowan, AFL President @ (780) 218-9888

Statistics Canada says the country's labour market shed another 45,000 jobs in July as more people struggled to find work.

Labour groups want a uniform system of EI eligibility to replace the current system that requires people to work different numbers of hours to qualify for benefits depending on where they live.

The Alberta and Saskatchewan federations of labour are also calling for EI changes.

AFL President Gil McGowan says only about 40 per cent of Alberta's unemployed are getting EI benefits - the lowest rate in the country.

570 News, Kitchener, On, Fri Aug 7 2009

The stats, which were released this morning, show Canada's jobless rate stayed steady at 8.6 percent.

But here in Alberta it rose nearly half a percent to 7.2 and in Calgary it jumped from 6.6 to 6.9 percent. The AFL says only 40% of the Albertans applying for EI are actually receiving the cash they need.

AFL president Gil McGowan says the reason for the low eligibility is because of regional differences in the current system.

He adds it's not fair that a person in Calgary and a person in Cape Breton aren't getting the same help even though both have lost their jobs and both have put the same amount of money into the system.

660AM News, Calgary, Fri Aug 7 2009
Cormac MacSweeney and Kelly Turner

At 23, she had never been laid off before. She was a full-time administrator at a pension company in Calgary until mid-March and thought she'd find a new job easily.

But with Alberta's economy sinking deeper into recession, Eide, a single mother of a toddler with no savings to help her, soon found herself evicted from her rental home, dependent on handouts from her family until her first unemployment cheque arrived.

"Ten weeks was way too long to wait. How is anybody going to survive?" she said.

Aside from financially straining laid-off workers, Employment and Immigration Minister Hector Goudreau said Alberta's average 10-week wait--among the longest in the country--is putting pressure on provincial coffers, as more and more people without savings are turning to the welfare system for relief.

I n April, 523 Albertans waiting for EI were granted aid from Alberta Works welfare program, a 120 per cent spike from 238 in December. The federal government eventually reimburses the province for these funds.

"There is no reason why it should take 10 weeks. That's not acceptable," Goudreau said.

The length of time jobless Albertans are waiting for employment insurance is one of several reforms the provincial government is seeking to an "inequitable" federal program.

In a sense, the province's unprecedented economic growth, which stalled only months ago, is now handcuffing jobless Albertans.

Long EI waits are mainly due to federal government staffing levels based on boom-time jobless rates below four per cent. Ottawa is attempting to address this issue by adding staff and processing Albertans' applications in other provinces, but Goudreau said it's too soon to tell whether the delay is easing. (Human Resources and Skills Development, the federal department responsible for EI, did not respond Friday to questions about the delay.)

While the EI wait is frustrating many unemployed Albertans, a larger number of them don't even qualify for the insurance program funded by employers and employees.

Jobless Albertans, who face tougher eligibility rules than almost anyone else in the country because of the province's relatively low unemployment rate, are least likely to receive EI, according to statistics compiled by the Alberta Federation of Labour.

Of the 123,000 unemployed Albertans in March, only about one-third are receiving insurance benefits, compared to 46 per cent in British Columbia, 57 per cent in Quebec, and more than 90 per cent in Prince Edward Island and Newfoundland.

Meanwhile, Alberta's jobless rate has risen rapidly since the global economic downturn hit. In May, the rate jumped to 6.6 per cent, the highest level since October 1996 and a stark increase from 3.7 per cent in October.

The number of Albertans relying on the province's welfare program is also growing, to 34,143 in May, a 27 per cent increase from October.
Provincial disgruntlement with the federal EI program has been strongest in the West, while on the federal political stage, the Liberals have threatened to force an election over the issue.

Days after the Harper Conservatives and the Ignatieff Liberals agreed to create a working group to examine Canada's employment insurance system over the summer, a package of proposed reforms surfaced from Western premiers and territorial leaders at their annual meeting, held last week in Dawson City, Yukon.

They want the EI program streamlined from 58 regions to three -- urban, rural and remote -- and are calling for more equitable support regardless of where people live.

Currently, laid-off workers in regions with higher employment rates require more hours on the job to qualify for benefits than those living in areas with worse employment prospects.

The range varies from 420 hours to 700 hours. The length of EI payments also hinges on employment rates.

Premier Ed Stelmach views the system as a "transfer of wealth out of the West to Eastern Canada."

"Today there's quite a difference between the number of hours worked to qualify for EI in Eastern Canada compared to Western Canada, so that is a disparity," he told a radio talk show on Friday.

"An employed family is equally unemployed, whether they live in Nova Scotia, Quebec or in Alberta."

Last week's decision to create a federal EI working group concerns the Canadian Federation of Independent Business.

Spokesman Dan Kelly said small businesses want the federal opposition parties' proposal for a national eligibility standard of 360 hours off the table.

Kelly contends lowering the EI threshold will discourage unemployed people from looking for work or moving to regions with better job prospects, potentially exasperating labour shortages in the future.
The business group also has reservations about the Conservative government's desire to extend EI payments to self-employed Canadians.

"From a practical level, how is that even workable? How can you lay yourself off?" Kelly questioned.

Goudreau shares some of Kelly's reservations about potential EI reforms, saying a balance must be struck.

"We don't want to make employment insurance so good and so readily available that people don't want to go to work," Alberta's employment minister said.

Alberta Federation of Labour president Gil McGowan dismisses this notion, however. Given the choice between working or drawing on temporary EI benefits, McGowan believes most Canadians would choose to work.

McGowan supports adopting a 360-hour national standard. The union also wants the ceiling on benefits raised to 70 per cent of an employee's earnings.

"These are not handouts. This is money workers have set aside themselves to help through hard times," McGowan said.

"The problem is not that the benefits are too generous. The problem is there are not enough jobs to go around."

In Calgary, the city's growing ranks of jobless workers can be felt at the Calgary Workers' Resource Centre.

The centre helps workers file claims and appeals for employment insurance, worker compensation and human rights abuses.

It noticed a marked increase in the first three months of 2009 compared to the same period last year--269 claims and appeals versus 70 in 2008. EI issues make up 90 per cent of the files, said centre director Xavier Cattarinich.

Like McGowan, Cattarinich believes a lower, uniform qualifying threshold is needed.

He said bolstering Canada's EI system will help reduce poverty, crime and welfare cases.

"You can pay now or much more later down the road," he said.

As politicians squabble over EI reform, Heather Eide wonders how she and her young daughter will manage on $1,400 a month.

Her employment insurance cheque is less than half of what she was making at a Calgary pension company. Eide's monthly rent alone is $1,350 in the new home her mother helped secure after her eviction.
Eide's EI payments are set to end after 27 weeks.

"For how much I paid into EI over the years, it's totally not enough," she said.

"Nobody can live off $1,400 a month."

Eide hopes to find a job paying close to the $20-an-hour wage she once made, but she's not feeling optimistic.

She's noticed wages in her line of work have dropped to about $14 an hour.

"I have been applying to everything that has an income level that I need," she said. "The market is just so terrible right now. I'm not even getting calls back for jobs I don't want."

Calgary Herald, Mon Jun 21 2009
Byline: Renata D'aliesio

When it comes to employment, new figures from Statistics Canada show that Alberta has fallen further and faster over the past six months than any other province.

Between October 2008 and March 2009, Alberta lost more than 73,000 full-time jobs. This was partially offset by an increase in part-time employment (22,000 jobs) - but left Alberta with a net loss of 51,400 jobs over the period.

Between March 2008 and March 2009, the number of unemployed people in Alberta has jumped by 72 per cent - the highest increase in the country.

During the same period, the number of unemployed in Ontario increased by 36 per cent and in B.C. the number jumped 69 per cent. By contrast, the number of unemployed in Manitoba increased by 17.5 per cent and in Saskatchewan the figure moved up by only 15 per cent.

Alberta's unemployment rate (5.8 per cent) is still substantially lower than the national average (8 per cent) but higher than Saskatchewan (4.7) and Manitoba (5.1).

The Alberta Federation of Labour believes that both the provincial and federal governments can and should be doing more to keep Albertans working and help those who have lost their jobs.

In particular, the AFL sees the Alberta government's recent budget as a missed opportunity. The budget promises to keep operational and infrastructure spending at roughly the same levels as last year.

"Albertans - especially those working in the construction, manufacturing and energy sectors - are having a hard time staying afloat," says Gil McGowan, president of the Alberta Federation of Labour. "The good news is that the government hasn't thrown them an anvil as Ralph Klein did during the last recession. But they haven't thrown them a life preserver either."

McGowan says that Alberta continues to have the fiscal capacity to do much more to stimulate the economy and create jobs.

He also says the Stelmach and Harper governments need to be more transparent about where federal stimulus money will be spent. And he says changes desperately need to be made to the Employment Insurance system because only 1 in 3 unemployed Albertans are currently entitled to receive benefits.

"In January of this year, there were 93,500 unemployed people in Alberta - but only 29,000 of them qualified for benefits," says McGowan. "With the unemployment rate in Alberta climbing rapidly, we simply can't afford to have a system that leaves two-thirds of unemployed Albertans out in the cold."

-30-

For more information call:

Gil McGowan, AFL President       office: (780) 483-3021    cell: (780) 218-9888

EDMONTON - Thousands of unemployed Albertans have been left without adequate means of support and hundreds of millions of dollars have been drained away from the Alberta economy - all as the result of radical changes made to the Unemployment Insurance system over the past ten years.

Those are just two of the findings contained in a study released earlier today by the Canadian Labour Congress in Ottawa. The study uses Statistics Canada data to paint a picture of the disturbing impact that changes to the UI system are having on individuals, communities and businesses across the country.

"All of us in the labour movement have been saying for years that the federal government has made bad decisions in the area of UI policy - particularly when they imposed brutal changes to the rules for UI eligibility in 1996," says Audrey Cormack, president of the Alberta Federation of Labour. "Now this study proves our point. Canadian workers and Canadian communities are paying a heavy price as a result of the so-called reforms."

On the national level, the CLC study shows that the changes to UI rules have dramatically reduced the support available for jobless workers. In 1997, only 36 percent of unemployed Canadians qualified for UI benefits - down from 74 percent in 1989.

The situation is even more serious in Alberta, where the percentage of unemployed workers receiving benefits dropped from 60 percent in 1989 to 27 percent in 1997. According to the CLC study, only Ontario has a lower eligibility rate (25 percent in 1997).

"The attack on working people started with the Mulroney government and has intensified under the Liberals," says Cormack. "Both governments made it more difficult for workers - especially women and young people - to qualify for the benefits they deserve. The result is that the UI system is no longer there for Canadians when they need it."

But unemployed Canadians aren't the only ones who have been hurt by the changes to the UI system, adds Cormack. She says the cuts to UI pay-outs have also caused a lot of pain for communities and businesses across the country.

The CLC study shows that an average of $660 million dollars has been drained away from the Alberta economy each year since 1993 as a result of the UI cuts - for a total of more than $3.3 billion. Between 1993 and 1997, most federal ridings in the province have lost at least $100 million - some as much as $200 million.

For example, the federal riding of Calgary Centre lost an average of $41.6 million a year in UI benefits between 1993 and 1997 - for a total of $208 million. About $39.4 million was lost from the local economy in Edmonton East during the same period - for a total of $197 million.

"We're not talking about faceless numbers here," says Cormack. "Every dollar that has been withdrawn from the UI system represents a dollar taken out of the pockets of unemployed Canadians. It's one less dollar they have to spend on their rent or providing for their families. It's also one less dollar to be spent at the corner grocery store or at the local mall. The personal and economic costs of the UI cuts have been truly staggering."

Cormack says the most tragic part of this story is that the UI cuts imposed by the Mulroney and Chretien governments were entirely unnecessary. Even during the darkest days of the last recession, the UI fund was not over-extended and there was no evidence of wide-spread abuse of the system.

To add insult to injury, Canadian workers are still paying roughly the same amount in UI premiums as they did earlier in the decade - even though it's much more difficult to collect benefits. The result is that a huge surplus has developed in the UI fund - more than $20 billion over the past five years.

Cormack says the time has come for the federal government to reassess its policies and use the UI fund for the purpose it was intended - to support unemployed workers, not as a slush fund to finance other government expenditures.

"It's clear now that the so-called UI "reforms" of the past ten years have been a disaster for workers, communities and business," says Cormack. "The time has come for the federal government to admit they made a serious mistake. The time has come for them to them to put the surplus dollars back into the UI system. The surplus should be used to restore the system - to make UI more accessible and more generous. Right now, too many people are being left out in the cold - and that's a situation that has to change."

For more information call:

Audrey Cormack, President:     483-3021 (wk)  499-6530 (cell)  428-9367 (hm)

or

Gil McGowan, AFL Communications:     483-3021 (wk)

*Note:  2-page backgrounder attached

AFL -- UI Backgrounder

Number of Regular UI Beneficiaries - Monthly Average (in thousands)

             Percentage of Unemployed Receiving UI

Percentage of Unemployed Albertans Receiving UI - By Gender and Age Group

Estimated Annual Loss in Benefits, Alberta Federal Ridings, 1993-1997 ($millions)

That's the message that Cormack will deliver to a travelling parliamentary panel when it stops in Edmonton tomorrow.

The panel is chaired by Yvon Godin, a Nova Scotia MP and EI critic for the federal New Democrat caucus. Godin has been travelling the country since before Christmas in order to gather information about the impact of changes made to the EI system in 1996.

"Mr. Godin says he wants to get a clear picture of what effect the changes have had on the lives of ordinary Canadians," says Cormack. "Well, here in Alberta the situation is clear - only a tiny fraction of the unemployed currently qualify benefits under the new rules. The EI system is no longer there for Canadians when they need it."

The EI panel will be meeting between 10 a.m. and 3 p.m. tomorrow (Tuesday, January 12) in Ballroom B of the Howard Johnson Hotel - located at 10010-104 Street in downtown Edmonton.

Cormack is scheduled to give her presentation to the panel at 10 a.m. Godin will be available to answer questions during breaks throughout the day. At 3 p.m., Godin will summarize what he has heard during the day.

For more information call:
Gil McGowan, Communications Director: 483-3021