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Annex 6: Key studies referenced in the report

Official title: Employment Insurance Monitoring and Assessment Report for the fiscal year beginning April 1, 2021 and ending March 31, 2022: Annex 6: Key studies referenced in the report

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List of abbreviations

This is the complete list of abbreviations for the Employment Insurance Monitoring and Assessment Report for the fiscal year beginning April 1, 2021 and ending March 31, 2022.

Abbreviations
AD
Appeal Division
ADR
Alternative Dispute Resolution
AI
Artificial Intelligence
ASETS
Aboriginal Skills and Employment Training Strategy
B
Beneficiary
B/C Ratio
Benefits-to-Contributions ratio
B/U
Beneficiary-to-Unemployed (ratio)
B/UC
Beneficiary-to-Unemployed Contributor (ratio)
BDM
Benefits Delivery Modernization
CAWS
Client Access Workstation Services
CCAJ
Connecting Canadians with Available Jobs
CCDA
Canadian Council of Directors of Apprenticeship
CCIS
Corporate Client Information Service
CEGEP
College of General and Professional Teaching
CEIC
Canada Employment Insurance Commission
CERB
Canada Emergency Response Benefit
CESB
Canada Emergency Student Benefit
CEWB
Canada Emergency Wage Subsidy
COEP
Canadian Out of Employment Panel Survey
COLS
Community Outreach and Liaison Service
CPP
Canada Pension Plan
CRA
Canada Revenue Agency
CRB
Canada Recovery Benefit
CRCB
Canada Recovery Caregiving Benefit
CRF
Consolidated Revenue Fund
CRSB
Canada Recovery Sickness Benefit
CSO
Citizen Service Officer
CWLB
Canada Worker Lockdown Benefit
CX
Client Experience
EAS
Employment Assistance Services
EBSM
Employment Benefits and Support Measures
ECC
Employer Contact Centre
EI
Employment Insurance
EI-ERB
Employment Insurance Emergency Response Benefit
EICS
Employment Insurance Coverage Survey
EIPR
Employment Insurance Premium Ratio
eROE
Electronic Record of Employment
ESDC
Employment and Social Development Canada
eSIN
Electronic Social Insurance Number
FY
Fiscal Year
G7
Group of Seven
GDP
Gross Domestic Product
GIS
Guaranteed Income Supplements
HCCS
Hosted Contact Centre Solution
HR
Human Resources
ID
Identification
IQF
Individual Quality Feedback
IS
Income Security
ISET
Indigenous Skills and Employment Training
IVR
Interactive Voice Response
JCP
Job Creation Partnerships
LFS
Labour Force Survey
LMDA
Labour Market Development Agreements
LMI
Labour Market Information
LMP
Labour Market Partnerships
LWF
Longitudinal Worker File
MAR
Monitoring and Assessment Report
MBM
Market Basket Measure
MIE
Maximum Insurable Earnings
MSCA
My Service Canada Account
NAICS
North American Industry Classification System
NESI
National Essential Skills Initiative
NIS
National Investigative Services
NOM
National Operating Model
NQCP
National Quality and Coaching Program
OAG
Office of the Auditor General of Canada
OAS
Old Age Security
OSC
Outreach Support Centre
PAAR
Payment Accuracy Review
PEAQ
Processing Excellence, Accuracy and Quality
PPE
Premium-paid eligible individuals
PRAR
Processing Accuracy Review
PRP
Premium Reduction Program
PTs
Provinces and Territories
QPIP
Quebec Parental Insurance Plan
RAIS
Registered Apprenticeship Information System
RCMP
Royal Canadian Mounted Police
R&I
Research and Innovation
ROE
Record of Employment
ROE Web
Record of employment on the web
RPA
Robotics Process Automation
SAT
Secure Automated Transfer
SCC
Service Canada Centre
SD
Skills Development
SD-A
Skills Development – Apprenticeship
SD-R
Skills Development – Regular
SDP
Service Delivery Partner
SEPH
Survey of Employment, Payrolls and Hours
SIN
Social Insurance Number
SIR
Social Insurance Registry
SRS
Simple Random Sampling
SST
Social Security Tribunal
STDP
Short-term disability plan
SUB
Supplemental Unemployment Benefit
TRF
Targeting, Referral and Feedback
TTY
Teletypewriter
TWS
Targeted Wage Subsidies
U
Unemployed
UC
Unemployed contributor
UV
Unemployment-to-vacancy
VBW
Variable Best Weeks
VER
Variable Entrance Requirement
VRI
Video Remote Interpretation
WCAG
Web Content Accessibility Guidelines
WWC
Working While on Claim

1. Initial impacts of temporary Employment Insurance measures in Canadian communities during the pandemic

Author(s), year

ESDC: Employment Insurance Policy Directorate, 2022

Objective(s)

This study examines the initial impacts of the EI temporary measures on the eligibility for EI benefits and on the additional income support provided to claimants, and also estimates the preliminary additional cost generated by the measures.

Key finding(s)

Among claims established during the reporting period going from September 27, 2020 to April 3, 2021:

  • 13.2% of regular claims and 7.6% of special benefit claims would not have been able to qualify for benefits if the temporary measures had not been in place
  • 65.6% of regular claims and 57.2% of special benefit claims had a higher benefit rate than what they would have been entitled to without the temporary measures
    • Among claims that benefitted from the minimum weekly benefit rate of $500 (or $300 for extended parental), they received, on average, an additional $199 per week for regular claims and $167 per week for special benefit claims
    • Among claims with a weekly benefit rate above $500 and that benefitted from a higher benefit rate due to the temporary measures, they received, on average, an additional $56 per week for regular claims and $34 per week for special benefit claims
  • All regular claims could potentially benefit from the maximum 50 weeks of regular benefits. However, only 16.5% benefitted from additional weeks of regular benefits at the end of the reporting period. This is because most of the claims had not exhausted their actual entitlement at that time
  • The additional cost incurred by the temporary measures is estimated at $6.1 billion over the reporting period. The largest share is related to the minimum benefit rate of $500 (or $300 for extended parental) ($4.6 billion)

Availability

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2. 2022 Actuarial Report on the Employment Insurance Premium Rate

Author(s), year

Office of the Chief Actuary, 2021

Objective(s)

The purpose of this report is to provide the Commission with all the information prescribed under section 66.3 of the EI Act. Pursuant to this section, the Chief Actuary shall provide the Commission with a report that sets out:

  • the forecast premium rate for the following year and a detailed analysis in support of the forecast
  • the calculations performed for the purposes of sections 4 and 69 of the EI Act
  • the information provided under section 66.1, and
  • the source of the data, the actuarial and economic assumptions and the actuarial methodology used

Key finding(s)

  • The 2022 Maximum Insurable Earnings (MIE) was $60,300 or a 7.1% increase from the 2021 MIE of $56,300
  • The 2022 estimated cost savings to the EI program that are generated by employer sponsored qualified wage-loss plans were $1,159 million

Availability

This report is available at: https://www.osfi-bsif.gc.ca/Eng/Docs/EI2022.pdf

3. Supplemental Unemployment Benefit Plans

Author(s), year

ESDC: Evaluation Directorate, 2021

Objective(s)

This study examines the characteristics of employers and employees who take part in the Supplemental Unemployment Benefit (SUB) Program, and their utilization of Employment Insurance benefits.

Key finding(s)

  • Between 2008 and 2017, the number of firms with an active registered SUB plan increased from 5,714 to 7,782—an annual average of around 6,800 active firms—which represents a little over 0.5% of all firms in Canada
  • Registered SUB plans for illness, injury or quarantine account for around 63% of all plans while SUB plans for temporary stoppage of work, training or plans where there are a combination of top-up plans account for around 10%, 7% and 20% respectively
  • Overall, EI claims which receive top-up payments through registered SUB plans account for around 3% of all EI claims or between 40,000 and 60,000 claims per year. However, the analysis found that only 13% of EI claims from firms with registered SUB plans received top-up payments
  • Claimants who receive top-up payments for regular benefit claims are more likely to return to the same firm after a claim as compared to those who worked for non-SUB firms. A positive relationship is observed between job tenure and SUB claim whereby individuals tend to stay with an employer longer if they are part of a SUB firm

Availability

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4. Household consumption one year after job loss among EI recipients

Author(s), Year

ESDC: Economic Policy Directorate, 2023

Objective(s)

This study examines household consumption one year after a job separation among EI recipients and other groups in Canada in 2005 to 2013. It focuses mainly on those that have a lower consumption than before their job separation.

Key Finding(s)

The income shock from job separation was not persistent for the majority of households

  • One year after a job separation, about 85% of individuals had household consumption levels greater or equal to before their job separation. Moreover, 70% of individuals had household income greater or equal compared to before their job separation
    • Theses results were relatively consistent across demographic groups such as gender, marital status, visible minority status and immigration status
    • Such results suggest that the EI program helped to mitigate the financial hardship of being unemployed for many households. It was not known if they had borrowed or reduced their savings to maintain their consumption level

However, some households continued to struggle financially one year after a job separation, suggesting they are living with low income

  • Individuals were generally more at risk of having a lower household consumption level a year after their job separation if they had not found a new job
  • Among the 15% of individuals who had a lower household consumption level one year after job separation, the average consumption level was around $1,950 per month (in $ of 2016 adjusted for family size). Consumption levels are adjusted for family size by dividing household consumption by the square root of family size, as Statistics Canada does for the Market Basket Measure (MBM)
    • For those not working at the time of the survey, the average monthly consumption was even lower ($1,693) which is below the highest MBM threshold ($1,729), a low-income measure that takes into account basic needs
  • Furthermore, around 50% of individuals who had a lower household consumption level one year after their job separation were consuming below the MBM thresholds

Availability

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5. Firms, industries, and cross-subsidies: patterns in the distribution of EI benefits and premia

Author(s), Year

ESDC: Labour Market Information Directorate, 2023

Objective(s)

This study examines how Employment Insurance (EI) premiums and benefits are distributed across industries, provinces, and firms using EI administrative data from 2008 to 2018.

Key Findings(s)

  • While cross-subsidization between firms, industries and provinces is still a feature of the EI program, we find evidence that the degree and impact has lessened in the period of 2008 to 2018 relative to the period 1986 to 1996
  • Overall, provinces east of Ontario receive net transfers from the rest of the country. The Construction industry receives the greatest benefits while Public administration, Utilities, and Finance, insurance and real estate are amongst the largest contributors to the EI program
  • Most industries are either "never subsidized" (for example, Utilities, Public administration) or "always subsidized" (for example, Construction) by the EI program:
    • Just over 39% of industries never received a net subsidy during the study period and they accounted for about 44% of all jobs
    • Just over a quarter of all industries (26.2%) were always subsidized in the study period while accounting for about 25.6% of all jobs
    • High rates of claims and low wages are major drivers for industries to receive persistent subsidies from the EI program
  • In a neo-classical model, EI cross-subsidisation results in a misallocation of labour. The estimated cost of this is much smaller both in terms of absolute size and as a percentage of total EI benefits compared to that calculated in Corak and Chen*
    • In relative terms, it amounts to 6.19% of total EI benefits for the period 2008-2018, while over the 1986-1996 period the estimated cost amounted to 16.5% of total EI benefits

* Miles Corak and Wen-Hao Chen, Firms, industries and unemployment insurance: an analysis using employer-employee data from Canada (Government of Canada, Statistics Canada, Analytical studies branch research paper, 2005, Series no. 11F0019MIE – No. 260).

Availability

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6. The Redistributional Impact of Employment Insurance, 2007 to 2009

Author(s), year

Ross Finnie, Queen's University School of Policy Studies; and Ian Irvine, Concordia University (for HRSDC, Evaluation Directorate), 2013

Objective(s)

The objective of this study is to investigate the degree to which Canada's EI program has redistributed purchasing power during the recent economic recession. More precisely, the period of investigation runs from 2007 to 2009, although results from the 2002 to 2006 period are also presented in order to place the recession period in a longer‑term context.

Key finding(s)

  • EI redistributes income substantially when the unit of analysis is individual earnings. The lower deciles of the distribution benefit both on the contributions and benefits sides
  • The quantitative redistributional impact of EI in 2009 appears to be approximately twice the impact of 2007
  • In 2007 and 2008, Quebec was the largest recipient of benefits (even without accounting for family benefits). However, 2009 saw a reversal of this pattern: Quebec's benefits increased by 20%, whereas Ontario's benefits increased by almost 50%, a reflection of how much harder the recession hit the employment sector in Ontario than in Quebec

Availability

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7. Financial impacts of receiving Employment Insurance

Author(s), year

Constantine Kapsalis, Data Probe Economic Consulting Inc., 2010

Objective(s)

This study explores the financial impact of receiving EI benefits. It probes the evolution of individual incomes before, during and after the receipt of EI benefits, as well as the influence of receiving EI on household consumption.

Key finding(s)

  • The average EI beneficiary experienced a 38% drop in wages during a year with EI. The most important offsetting factor was EI; it replaced about 38% of lost wages. The second most important factor was investment income; it replaced about 9% of lost wages. Other income sources played a lesser role
  • Lower income families received a higher return of their contributions than did higher income families. In fact, families with after-tax income below the median received 34% of total benefits and paid 18% of all premiums in 2007. The study also found that EI halved the incidence of low income among beneficiaries (from 14% to 7%) during that period

Availability

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8. The end of EI flexibility's minimum benefit rate

Author(s), Year

ESDC: Evaluation Directorate, 2023

Objective(s)

This study examines the effect of ending of the temporary $500 minimum benefit rate on the proportion of benefits used and probability of exhausting benefits.

Key Finding(s)

  • To isolate the impact of the $500 minimum benefit rate from the other temporary measures (including a fixed 50-week entitlement), multiple methods were considered. Overall, the various methods indicate that the minimum weekly benefit rate had an effect on benefit usage
  • The decomposition method estimated that for those benefiting from the minimum weekly benefit rate of $500, the minimum rate could have led to an increase in benefit usage up to 4.9 additional weeks. However, this result should be interpreted as a higher bound
  • The graphical analysis showed that claimants who established their claim one week before the end of the measure and benefitted from the $500 minimum benefit rate exhausted their benefits at a lower rate (44.1%) than similar claimants that established their claim the week after the end of the temporary measure (65.3%) due to their shorter entitlement
  • A difference in difference approach confirmed that the minimum $500 benefit rate increased the proportion of entitlement used by 3.0% (1.5 weeks). This result was statistically insignificant at the 90%. However, claimants who had the largest reduction in benefits as a result of the end of the minimum benefit rate had the largest and significant decrease in their benefit usage (4.2 percentage points or 2.1 weeks)
  • A hazard ratio approach showed that claimants with lower benefit rate exited EI benefits faster (lower usage of entitlement) one week after the end of the temporary measures compared to one week before the end of the temporary measures. This effect was potentially due to the minimum $500 benefit rate

Availability

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9. Evaluation of the Employment Insurance seasonal claimant pilot project (pilot project No. 21)

Author(s), Year

ESDC: Evaluation Directorate, 2022

Objective(s)

This evaluation assesses the impact of the Employment Insurance (EI) seasonal claimant pilot project (Pilot Project No. 21).

Key Finding(s)

  • By relying on the timing of a claim, the targeting mechanism shows some effectiveness in identifying claimants with a frequent pattern of seasonal work. However, the mechanism was sensitive to other non-seasonal measures that affect the start or end date of a claim
  • Approximately 10% of all seasonal claimants have a period without income following their claim (seasonal gappers) and the risk of this event to reoccur year-over-year is low
  • For seasonal claimants, an impact analysis found that the pilot project reduced the incidence of having a period without income by over 7 percentage points. This impact steadily decreased as the number of EI regular benefit weeks claimants were entitled to increased
  • Analysis points to the pilot project influencing subsequent work patterns of seasonal claimants who were eligible to additional weeks. Specifically, employment income decreased and benefit duration increased following the introduction of the pilot project, while total income remained unchanged
  • Relative to previous pilot projects, Pilot Project No. 21 was more efficient at targeting seasonal gappers. Still, most of the additional weeks of benefits were paid to seasonal non-gappers

Availability

This report is available on the Employment and Social Development webpage at: Evaluation of the Employment Insurance Seasonal Claimant Pilot Project (Pilot Project No.21) - Canada.ca

10. Factors that impact the duration of benefits for EI regular claimants

Author(s), Year

ESDC: Evaluation Directorate, 2023

Objective(s)

This study examines the factors that affect the duration (share of entitlement used) and exhaustion rate of Employment Insurance (EI) regular benefits between 2009 and 2018.

Key Finding(s)

  • The number of insurable hours was a significant factor that affects the share of entitlement used and the exhaustion rate compared to the unemployment rate
  • Compared to the growth period (2011 to 2018), claimants' entitlement and the number of weeks used were longer during the recession period (FY0910), but claimants exhausted at a lower rate
  • Male claimants with low insurable hours (1,049 or less) used a greater share of their entitlement and exhausted at a higher rate than women (59.5% to 52.3%), but the opposite was observed for claimants with high insurable hours (21.8% for men to 31.3% for women)
  • Linear probabilistic regressions indicated that the size of the labour market and the weekly benefit rate (amount) were positively correlated with the exhaustion rate. Thus, the regression shows that:
    • Every percentage point increase in the unemployment rate slightly decreased the exhaustion rate by 0.8 percentage point. In comparison, the exhaustion rate decreased by 3.0 percentage points for each additional 100 insurable hours. Potentially due to data limitations, the effect of the job-vacancy rate on exhaustion rate was not significant
    • The probability of exhausting was lower for long-tenured workers as well as claimants with higher education levels and income
  • A Regression Discontinuity Design model shows that an increase of two entitlement weeks due to small changes in the unemployment rate had no significant impact on the number of weeks received for claimants with high insurable hours and long-tenured workers. As a result, it reduced the share of entitlement used and exhaustion rate, particularly in lower unemployment-rate regions

Availability

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11. Characteristics of firms that hire apprentices

Author(s), year

ESDC: Labour Market Information Directorate, 2020

Objective(s)

The purpose of this study is to examine the characteristics of firms that employ EI-supported apprentices. This involves examining the interaction between firms and apprentices during and after apprenticeship.

Key finding(s)

  • The share of apprentices in a firm's workforce is positively correlated with its productivity (that is, value-added per employee), a pattern that has become more apparent since the FY0809 recession
  • There is no clearly defined hypothesis regarding a firm's capital-intensity and its demand for apprentices. The study found that EI-supported apprentices are concentrated in the workforces of moderately capital-intensive firms and do not make up a large proportion of the workforce of the most capital-intensive firms nor the least capital-intensive firms
  • Firms that train apprentices do so regularly. More specifically, larger firms are more likely to hire apprentices every year and are more likely to have hired an apprentice at least once in the study period (2001 to 2016). However, on average, smaller firms hire disproportionately more apprentices. Almost 1 in 2 apprentices work in firms with 5 to 49 employees
  • On average, 4 out of 5 apprentices that claimed EI worked for a single employer from 2001 to 2012. However, not many apprentices end up working long-term with the employers that train them. Just under 50% of apprentices stay with their first firm for more than 3 years

Availability

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12. Profile of Skills Boost participants

Author(s), Year

ESDC: Employment Insurance Policy Directorate, 2023

Objective(s)

This study examines the use of the Skills Boost pilot since its inception in 2018 and how participants compared to EI Part II non-apprentices and EI regular claimants overall.

Key Finding(s)

  • From 2018 to 2022, 3,420 long-tenured workers got permission from Service Canada to continue receiving their EI regular benefits while pursuing self-funded full-time training under the Skills Boost initiative. This represents around 0.3% of long-tenured workers claiming EI regular benefits each year. They collected a total of $53.9 million in EI benefits over the 4 fiscal years examined
  • When comparing Skills Boost participants to EI Part II non-apprentices (EI regular benefit claimants who got permission under the Section 25 of the EI Act to continue receiving EI benefits while being in full-time training):
    • Skills Boost participants are generally older. By definition a long-tenured worker has to have worked several years, which could partly explain the age difference among the 2 groups
    • The gender breakdown is similar between the 2 groups. In contrast, there is a higher share of women in both groups than among the overall EI regular claimants
    • In terms of regions, there are relatively fewer Skills Boost participants from the Atlantic provinces, while they are relatively more participants from Alberta
    • Participants came from a large variety of sectors. However, Manufacturing, Construction, and Retail trade industries accounted for the highest shares of participants for both groups
    • In terms of income 1 year before claiming EI, Skills Boost participants had, on average, significantly higher employment income. By definition, they have worked several years which could partly explain their higher employment income

Availability

A PDF version of this document can be ordered by calling 1 800 O-Canada (1-800-622-6232). If you use a TTY, call 1-800-926-9105. The PDF version can only be sent via e-mail. Please note there will be a certain delay before receiving the documents.

13. Evaluation of the Employment Insurance sickness benefits

Author(s), year

ESDC: Evaluation Directorate, 2020

Objective(s)

This evaluation provides an assessment of the impact of EI sickness benefits on post-illness separation outcomes based on the use, the accessibility, and the impact of the benefits. The focus is on EI claimants receiving sickness benefits from 2000 to 2016, excluding self-employed workers.

Key finding(s)

  • The duration of the benefits is adequate for most claimants, but those with severe and/or long-term illnesses are more likely to use the full 15 weeks of sickness benefits and remain sick hereafter
  • There has been significant growth in claims for the EI sickness benefits nationally since 2000 that can be explained, in part, by demographic changes
  • Access to employer short-term sickness and disability plans is not uniform across the labour force in Canada. Without such coverage, EI sickness benefits remain the main support for many workers
  • Gender (as well as educational attainment) had no statistically significant effect on the likelihood of whether someone claims or does not claim EI sickness benefits when other claimant's characteristics are taken into account (such as type of illness or industry of employment)

Availability

This report is available on the Employment and Social Development webpage at:

Evaluation of the Employment Insurance sickness benefits - Canada.ca

14. Compassionate care benefits: update (FY0405 to FY1516)

Author(s), year

ESDC: Evaluation Directorate, 2018

Objective(s)

The report describes the impact of the 2016 extension of the maximum duration on compassionate care benefits usage, and presents a socio-economic profile of individuals who applied for and received the benefits.

Key finding(s)

  • In FY1516, most compassionate care applicants were caring for their mother or father (58.1%), followed by a spouse or partner (27.5%)
  • On average, 8.7 weeks of benefits were paid in FY1516 compared to 4.8 in FY1011
  • Approximately one third of compassionate care applicants did not receive benefits. The main reason for not receiving the benefits was that the applicants received other employment insurance benefits, followed by the absence of the medical certificate
  • Applicants in British Columbia and Territories were statistically significantly more likely to have their applications approved
  • Multivariate analysis suggests that the probability of not using all weeks available to the claimants is mainly explained by the mortality of care recipients. However, the impact of the mortality on this probability is mitigated by the extension of the benefits duration from 6 to 26 weeks

Availability

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15. Identifying firms that are potentially most sensitive to EI premium changes

Author(s), Year

ESDC: Labour Market Information Directorate, 2023

Objective(s)

The main objective of this study is to identify firms that are more likely to be sensitive to EI premium increases. Firms are considered sensitive in this study if they have a higher proportion of minimum wage workers, suggesting a lower capacity to absorb increasing EI premiums. The study also measures the Employment Insurance Premium Ratio (EIPR) to examine the effective burden of EI premiums on firms.

Key Finding(s)

Smaller sized firms tend to have higher EIPRs, which is the ratio of EI premiums paid by employers to their total payroll

  • Between 2015 and 2020, the average employer premiums paid was $13.9 billion annually and this produced an average EIPR of 1.3% over this period
  • Excluding micro firms (firms with less than 5 employees), the EIPR declined with firm size with the highest EIPR being observed among firms with 5 to 50 employees (1.5%)

Smaller firms tend to have a higher proportion of workers at or near minimum wage, which suggests more sensitivity to any potential EI premium increases

  • There is a negative relationship between firm size and the proportion of workers near minimum wage. Given this, it might be harder for smaller firms to absorb possible increases in EI Premium rates through lower wage adjustments. In FY1819, firms under 20 employees had 13.5% of their workforce earning minimum wage. This proportion declined to 10% in FY2021 but was still double compared to larger firms. It was 5% for firms with 100 to 500 employees and 5.7% for those with over 500 employees.

Employment Insurance Premium Ratios and minimum wage patterns vary across industries and regions

  • Accommodation and food services had the highest EIPR (1.9%), whereas Mining, quarrying, and oil and gas extraction had the lowest EIPR (0.8%)
  • In general, Atlantic provinces had higher EIPRs than the rest of Canada excluding Quebec. Alberta had the lowest EIPR (1.2%), whereas Newfoundland and Labrador had the highest (1.6%)
  • In FY1819, Accommodation and food services had the highest proportion of workers near minimum wage (35.5%), whereas Construction had the lowest (2.1%)
  • Urban regions tend to have higher share of workers earning near minimum wage relative to rural areas

Availability

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2023-05-26

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