Research summary – Job vacancies and employment insurance utilization
Official title: Job Vacancies and Employment Insurance Utilization
Author of report: Sami Bibi
Why this study
Understanding the link between job vacancies and employment insurance (EI) use is important. It will help improve the program and make it more responsive and accessible.
What we did
The study examines job vacancies and EI patterns in Canada. It examines this by province and industry from 2004 to 2019. Data sources include:
- the Canadian Federation of Independent Business (CFIB)
- Canada’s Job Vacancy and Wage Survey (JVWS)
- the Survey of Employment, Payroll Hours (SEPH)
- Employment Insurance Statistics (EIS) survey, and
- the Labour Force Survey (LFS)
The measures of EI utilization used are:
- the ratio of the number of EI beneficiaries to unemployed persons (B/U), and
- the ratio of the number of EI beneficiaries to the labour force (B/LF)
What we found
- The share of EI beneficiaries compared to both the unemployed population and the labour force has declined for more than 2 decades. The key reasons include:
- a greater labour market efficiency
- an increased labour mobility
- a changing demographics and/or changes to the EI program itself
- Job vacancies and EI move in opposite directions in the short run. EI contributions increase and EI use decreases when the unemployment rate is low and there are many job vacancies. When the economy slows down the opposite happens
- There is not strong evidence that this happens in the long run. This could be due to many factors such as:
- structural changes in the demand for and supply of labour
- changes in the EI program, and
- the influence of other labour policies
- EI use rate and job vacancies vary by province and industry. For example, the Atlantic region had higher EI use rates compared to others. Similarly, the construction industry had higher EI use rates compared to others
What it means
This study shows how EI is used differently between recession and boom periods. The findings may support targeted labour market policies. For example, measures could be developed to support economic growth in provinces and territories that rely heavily on EI. These measures could be calibrated to offer enhanced support during recessions. EI use rates and job availability will need to be further researched.
Contact Us
Skills and Employment Branch, Labour Market Information Directorate, Policy Research and Geomatics Division
Email: ESDC.NC.SSPB.RESEARCH-RECHERCHE.DGPSS.CN.EDSC@hrsdc-rhdcc.gc.ca