EI Benefits Falling Faster Than Unemployment

Statistics Canada reported today that 12,290 fewer Canadians received Employment Insurance (EI) benefits in May compared to April. EI benefits are shrinking far faster than unemployment.

In percentage terms, the number of EI recipients declined as much in just the last month as unemployment declined over the past year. Between April and May, the number of unemployed Canadians decreased by only 1% while the number of EI beneficiaries decreased by 2.4%. Compared to May of last year, the number of unemployed workers was down by 2.4% but the number of EI beneficiaries was down by 7.4%.

We already know from the Labour Force Survey that unemployment rose in June. The downward trend in EI is troubling given that more workers will likely need benefits.

The federal government is cutting back EI too quickly given that unemployment is barely decreasing. As Armine Yalnizyan points out, EI coverage is now at its lowest level since World War II.

UPDATE (July 19): Quoted on page D1 of today’s Saskatoon StarPhoenix

Erin Weir is an economist with the United Steelworkers union and a CCPA research associate.

One comment

  1. The Conservatives are very similar to the Republicans in the States. Nothing is surprising here. Cut funding to save money. Sadly, the EI funds are monies that the employees put in out of their pay cheques as a buffer against periods of unemployment. The name shouldn’t have changed the name from UIC to EI, and funds shouldn’t have been taken OUT of the plan for other purposes. Nobody followed up on these events. You get what you vote for, and sometimes, more.

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