First of all, tomorrow is the tenth anniversary of the report of the technical committee on business taxation, which did recommend experience rating, and it was recommended on an individual firm basis.
Let me say first of all that Statistics Canada has done a number of studies, and while it's true that in some industries you have a higher incidence of layoffs, there's actually quite a differential experience across companies, even within the same industry. Therefore, in my view, experience rating—if we ever move in this direction—should really be done on an individual firm basis and not on an industry basis, which is an alternative approach.
With respect to compliance costs, this approach is often remarked to be more expensive, perhaps, but in some of the studies I've seen for the United States, the cost of complying with the unemployment insurance system, even with experience rating in some states, like Washington, is actually less than what we have in Canada. So I think we must ask some questions about what we are actually doing here in Canada, in terms of the administrative and compliance costs of running the system.
I would agree that there could be some additional expense, but then we have to remember the economic benefits associated here, because, effectively, EI is being used as a way of really helping companies to avoid making their own payments to keep individuals available to them when they're laid off, and then to bring back those individuals at a later time.
Really, what we're doing now is that we're imposing a significant tax on many sectors in the economy, including service companies. You mentioned banks, but you didn't mention a lot of the small companies that really have very little experience with unemployment and yet are paying very high premiums too.
The studies have actually shown that you could reduce unemployment rates by almost a percentage point if you did introduce at least some, or partial, experience rating for the EI system. That's why many economists are actually very favourable to the concept of experience rating, because it would have some significant economic benefit, especially at a time when we're worried about labour shortages.
I must say that one of the things that would need to be addressed is the way we handle regional benefits under the employment insurance system, which is particularly important for the Atlantic region.