Federal election 2019: Where do the four major parties stand on jobs and Employment Insurance?

Politicians are always talking about jobs, but what are they actually promising? Let’s break down the platforms.

The context

At the national level, Canada’s labour market is strong. According to Statistics Canada, the unemployment rate fell to a record low of 5.8 per cent in 2018. On most key measures, such as long-term unemployment, Canada’s labour market is back to where it was before the 2008-09 recession hit.

But the labour market now is not the labour market of a decade ago. The demographics of who is working, in which sectors, and where, has changed.

Related: Unemployment rate down after Canada adds 54,000 jobs in September

On demographics, some groups have had rising rates of participation in the job market. More older Canadians are in the labour force, a sign of the baby-boom generation edging into retirement, and more of those seniors are working past the traditional retirement age of 65. As well, more women between the ages of 25 and 54 are working than ever before. Statistics Canada data show the gap between how many men work and how many women work is the smallest the agency has seen since it started tracking those numbers in 1976.

Parisa Mahboubi, a senior policy analyst at the non-partisan C.D. Howe Institute, said the biggest factors in getting women to participate more in the workforce come down to work-life balance, and the affordability and availability of child care, as women in heterosexual parenting relationships are still saddled with more of the responsibilities of raising children.

On sectors, health and social-assistance have faced the most acute labour shortages, in which the problem for employers is finding enough skilled employees to take the jobs. Employment in the manufacturing sector has held steady in recent years, but is nowhere near its pre-recession heights. Dr. Mahboubi said her research shows the skills mismatch in Canada – what skills workers have, compared with what skills employers want – is slightly higher here than in other developed countries.

And the employment picture also varies widely by province. British Columbia led the pack in 2018 with an unemployment rate of just 4.7 per cent – while, on the opposite coast, Newfoundland and Labrador had nearly triple the rate, at 13.8 per cent unemployed. Newfoundland, Saskatchewan and Alberta have all suffered from a decline in the price of oil since 2014, driving job losses in the energy sectors of all three provinces.

Conservatives

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The Conservative Party frames many of its policies – such as its opposition to the Liberals’ carbon-pricing regime – in terms of the number of jobs created or lost in those industries. But on employment programs specifically, the Conservative promises are aimed at prospective parents.

The biggest promise is to make income from Employment Insurance maternity and parental benefits “tax free,” through the use of a new, nonrefundable tax credit.

Someone who has given birth can qualify for EI maternity benefits of up to 15 weeks, at a rate that is generally 55 per cent of their regular income, up to a maximum of $562 a week. After that, the birth parent (and other parents, including those who adopt) can qualify for parental leave up to 35 weeks at the same rate, or 40 weeks total, depending on how the leave is split between two people. Parents can also take a longer leave, up to 61 weeks or 69 weeks total for two people, at a lower weekly rate.

Currently, that money is considered by the government to be taxable income. The Conservatives propose to offset that through a 15-per-cent nonrefundable credit.

As well, the Conservatives are promising to introduce a new benefit for adoptive parents. The party says it would introduce a new 15-week EI adoption leave benefit, so that parents who adopt have an equivalent to the maternity benefit available to birth parents. The Conservatives would also increase the maximum claim for an adoption-expenses tax credit to $20,000 from $15,905.

Analysis

The Conservative promises are similar to those made by the Liberals. The Liberals are promising to create a 15-week EI leave for adoptive parents, too. And the Liberals are also promising to make EI parental and maternity leave tax free, though they have a different way of doing it. The Liberals say they would take off tax “at the source” – meaning that no income tax would be deducted when the EI cheques are mailed out. The Conservative proposal means the government would still deduct income tax as it pays out EI, but would try to pay that back at tax time.

Tammy Schirle, an economics professor at Wilfrid Laurier University, said the Liberal mechanism will make it easier for recipients to calculate how much they would save. The Conservative tax credit, she said, could mean less money back at the end of the day, depending on factors such as what other tax credits are being claimed or even the timing of the child’s birth. As well, because the credit is nonrefundable, all it can do is reduce a tax bill down to zero – it would not on its own give low-income recipients a refund.

But for both proposals, Prof. Schirle said she’s not sure EI should be taxed differently from other sources of income anyway. “I really don’t see a good reason why we would differentiate the EI parental benefits from other EI benefits that people are receiving," she said.

Liberals

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The Liberals are promising a number of changes to employment programs. In addition to the EI proposals mentioned above, they also promise to extend EI sick leave benefits to 26 weeks, from 15 weeks.

The Liberals, like the NDP and the Greens, say they would establish a $15 an hour federal minimum wage. Currently, the minimum wage for workers in federally regulated industries is whatever the rate is in the province in which the person works.

To boost the number of Canadians who work in the trades, the Liberals say they would collaborate with provinces and territories to create a Canadian Apprenticeship Service. The Liberals say they would give $10,000 in funding for each apprentice over four years.

The Liberals say they would extend labour protections to people who work through digital platforms, such as Uber drivers, whose status is not clearly covered by existing laws.

And the Liberals would create a new two-year Career Insurance Benefit, available to workers who have been with the same employer for at least five years and are laid off when the business closes. This is an extra benefit that workers could collect when EI ends (whether because their benefit runs out, or because they found a new job). The Career Insurance Benefit would be worth 20 per cent of insurable earnings for the first year, and 10 per cent in the second year. The maximum insurable earnings would be the same as that of EI.

Analysis

The idea behind the Career Insurance Benefit is to cushion the blow for workers who might find that their next job doesn’t pay as well as the one they had before. And it might encourage a worker to take a new job more quickly – and get off EI sooner – even if the new wage is lower than they’re used to.

Miles Corak, an economics professor with the Graduate Center at the City University of New York who previously worked in Canada, said it is a form of “wage insurance,” a policy that could help workers deal with economic shocks such as those due to trade.

Prof. Corak said that research shows long-tenured workers permanently lose, on average, 14 to 15 per cent of their earnings after they lose their job. He said an example would be someone who worked in a factory who is unlikely to find a comparably paying job if their plant closes down.

(Prof. Corak was part of a group of economists who advised the Liberal Party before the 2015 election.)

Frances Woolley, an economics professor at Carleton University, said that extending labour laws to cover those in the digital gig economy could be the first step to further regulation of companies such as Airbnb and Lyft. She said taxation is another area where the government might start treating those companies differently.

New Democrats

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The New Democrats are promising a big expansion of the EI program. They say it is necessary because although “almost all” workers pay into EI through premiums on every paycheque – known as payroll taxes – fewer than half will qualify when they need to collect it.

Currently, to qualify for EI a worker must have worked between 420 and 700 hours, depending on the unemployment rate in their area. Workers receive 55 per cent of their insurable earnings up to a maximum of $53,100 (which equals a maximum payment of $562 a week). A worker can collect the benefit between 14 and 45 weeks, again depending on the local unemployment rate and the number of hours they had worked.

The NDP, if elected, would lower the qualifying threshold to 360 hours across all regions. They would also boost the payments to 60 per cent of insurable earnings, and create a new “low-income supplement” that would act as a floor so that workers would receive a minimum of $1,200 a month.

The NDP would also expand EI sick-leave benefits to 50 weeks, from 15 weeks.

On parental leave, the NDP says it would give parents a new option that would give them higher benefits over a shorter period of time. The NDP did not specify in its platform what those rates or time periods would be.

Analysis

The NDP said in an e-mail that it would pay for these promises by making sure money in the government’s EI account wasn’t used for other purposes, by possibly raising the maximum insurable earnings, and by raising payroll taxes as necessary. EI is paid for through premiums that are set so the program runs break even on a long-term basis. The current rate is $1.62 per $100 of insurable earnings.

Prof. Schirle said changes to EI eligibility will affect how people behave. She pointed to a study published in 1997 that showed that, when qualifying hours were raised in some regions in 1990, workers changed what kinds of jobs they took on. She said some businesses could operate and hire differently, which could drive further changes in the program.

Greens

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The centrepiece of the Greens’ platform is a suite of policies to dramatically lower Canada’s greenhouse-gas emissions. That includes effectively shuttering the Alberta oil sands over the next 15 years and phasing out traditional cars by 2040.

Many of those moves would cause economic shocks and trigger waves of layoffs. The Greens say they will handle that through job-transition programs that will retrain workers in carbon-intensive jobs into new positions in the renewable-energy sector. They list a number of other policies they say would help, such as pension-bridging for workers close to retirement.

As well, the Green Party says an economy organized around low-carbon industries would provide its own new job opportunities.

Analysis

The Green Party platform lists a number of different job-related measures, including calling for the “modernization” of the EI program. On most measures, the platform does not explain what those changes would be, but says they would be done in consultation with employers and unions.

Prof. Corak said he thought many of the party’s goals were laudable but hard to evaluate without more information about how the party would achieve those goals.

“The Green Party is best at sort of illustrating what the challenges are … but short on real details,” Prof. Corak said.

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