Human Resources Committee on May 6th, 2014

[Ian Shugart]

Chair, I'm not in a position at the moment to give all of the detail on each of the recommendations. I could say a couple of things about that, which I hope will be helpful.

We have not followed the Drummond report, in terms of each recommendation being acted upon as given. Our reading of the situation is that we have acted very substantially on much of the content of his report. We've worked a lot over the last several years with Statistics Canada, the Department of Finance, the Bank of Canada, to improve the quality and the coverage of the data.

When Don did his report, for example, there was no job vacancy report, which we developed with Statistics Canada and we currently use. We think there has been, certainly not a complete response to his report, but a very substantial response, and that is a continuing effort by the department.

The second thing I would say—

[Rodger Cuzner, Liberal, Cape Breton—Canso, NS]

If I could, because we're talking about measurement, it's tough to measure “substantial”. Is there any kind of written response that we would have received or would be on file that the committee would benefit from with regard to the report?

[Ian Shugart]

We have a good sense...and we could provide information on the progress that has been made. It will not correspond recommendation by recommendation to the report, but we could—

[Rodger Cuzner, Liberal, Cape Breton—Canso, NS]

Mr. Chair, I think that would be beneficial to the committee.

[Ian Shugart]

We'd be happy to provide the committee with progress in the area of labour market information. I would stress that this is a work in progress. We are not satisfied, as public servants in the department, that we are currently providing the government, Parliament, the country, employers, etc., with labour market information and learning information as good as needs to be done, and we are committed to doing that.

Our goal is to use these conversations with the provinces as a vehicle for improving the partnership between jurisdictions, so that whoever has information provides it in a kind of open platform, and whoever needs information, can go to that open platform to receive it.

If we had our way, we would involve the learning institutions, the universities and colleges, and training institutions, as well as employers, and, where appropriate, administrative data. The work that we're doing in the job bank is a key set of progress that will help us in a whole range of programs—employment programs, the employment insurance program and so on—to improve quick returns to work and better job matching in the country. This is a major commitment in the department. We're not where we need to be, but we've made and continue to make good progress in this area.

[The Chair, Conservative, Phil McColeman]

Thank you very much.

Mr. Maguire, go ahead for five minutes, sir.

[Larry Maguire, Conservative, Brandon—Souris, MB]

Thank you, Mr. Chairman.

Thank you very much for your presentations.

Right now we have a situation in which a lot of EI clients are using about two-thirds of their part 1 benefits before returning to work. I'm wondering what more can be done to get people to return to work more quickly to reduce that net EI spending.

I see that in annex B of your presentation, one of the examples involves Hugh Munro Construction and the two-stage training process. I wonder if you can elaborate on that to see if that fits with the earlier question I had.

[Frank Vermaeten]

Thank you very much for the question.

I think a range of things can be done to reduce the use of EI by getting people back to work more quickly.

The first thing I would like to talk about is using a better referral system for EI clients. We have done some of the work towards that. We've set up a gateway to exchange information with the provinces and territories to make sure we have a secure line to transfer data. That's being put in place right now.

That is going to enable us to send data, including someone's profile, to provinces and territories when somebody becomes unemployed. The province is going to be able to take that information and—let's say they have 12 individuals who have just lost their job, who are collecting EI, who are in the trades, and who are highly skilled—immediately match it with their database of the kinds of jobs or effective training that is available and to assess where the best bang for the buck is. Then they'll know who they should train, who they should provide labour market information to, and who they should set aside. That referral system is going to be really important to allow provinces and territories to do that.

We do a little bit of that right now, but with this improved gateway, we're going to be able to do a lot more. I think that's one aspect of getting people back to work more quickly.

The second thing is that we want to be able to collect better data to understand what works for whom in the best possible way. I think that's going to be really important, and that's why you want to improve these performance measures, to figure out the best approach for each individual. So there's another thing that's going to help people get back to work.

Third, it's again about having the right kind of training for the individual. I talked about data, but there is also that employer involvement. If we can encourage provinces and territories to get better connected with employers, they will know right away what employers are looking for in an individual. It's not just what's on paper there, but a better description of the skills they need.

Let me add one more thing about something the federal government is working on that's going to help provinces and territories as well. We've recently introduced—and this speaks to Mr. Cuzner's question on labour market information—a job alerts system. This job alerts system allows individuals, whether they're on EI or not, to sign up for a service. They enter their basic information—“I am looking for a job locally in Ottawa”, or “I'm willing to move anywhere”, “these are my skills, and this is the kind of job I'm looking for”. As soon as employers register for the job bank where they have a job that matches, or Workopolis or one of the other job boards matches, twice a day we send that individual potential matches. So that job alerts system is going to alert people to the opportunities out there. That's going to help people, and it is already helping people get back to work. We want to continue to build on that.

The government has talked about putting in place a job-matching system so we can really get the two sides together—the individual who is looking for the job and the skills they have and the employer who is looking for somebody and the skills they're looking for. We can match the skills in a much better way. That's the next step.

All those things are going to help people get back to work more quickly.

[Larry Maguire, Conservative, Brandon—Souris, MB]

So in essence the job registry is between the employer and the potential worker. Provinces can play a role in that—and they do of course—but do you work more directly with chambers of commerce at all, or is it more on an individual-company basis as well?

I wonder if you could expand on what my colleague asked earlier with regard to the differences in provincial programming. But also, what do we have that we can look at from outside of Canada with regard to other countries providing similar programs? How far abroad do we go with regard to trying to look at successful programs in other nations?

[The Chair, Conservative, Phil McColeman]

Again, you're going to have to defer your answer on this. We're over time. Perhaps that can be woven into another answer.

To Mr. Garrison now, for five minutes.

[Randall Garrison, NDP, Esquimalt—Juan de Fuca, BC]

Thank you very much. I'm very pleased to be at the committee this morning to talk about this topic, and I thank the officials for their presentations.

I want to start by asking about what I see as a couple of large challenges the labour market development agreements have.

There was a 2013 OECD report that said that Canada provides the least protection of any OECD nation against job loss for part-time workers, and only the United States and New Zealand provide less protection for full-time workers. What it's really saying is that there's no incentive for employers to retrain people in the way our labour market is structured, but, instead, to lay people off at the first opportunity. That seems to provide a big challenge for the labour market development agreements if we don't encourage employers to retrain rather than lay off employees.

The second one, of course, is that only four out of ten workers are qualifying for employment insurance and, therefore, for the more intensive retraining programs. So you've set yourselves two big challenges, I think, when dealing with labour market agreements there.

My first question is, wouldn't easier qualification for EI benefits for youth and others in high unemployment regions really provide them with better access to the training they might need to avoid future unemployment?

[John Atherton]

In your first question, I think you have raised one of the more fundamental issues that almost all OECD countries are facing, the balance between flexibility in your labour and product markets with the social supports. When you look across countries—and it goes to the question I think the previous member asked—there are lots of different ways to judge that balance in Canada and how it contributes to our strong economic performance.

There's a balance here between the flexibility and the security, and employment insurance is only part of what is provided in Canada. If you look across the broad range of agreements, and especially the $3 billion in support that's provided from the federal government to the provinces and, in addition, their constitutional responsibility for welfare clients and so forth, in their entirety I think you get a better balance.

But getting this balance right is part of the questions we're talking to provinces and stakeholders about. We have, in fact, raised issues of whether or not young people, or people with fewer hours, or people who have been out of the labour market longer, should get access to EI. These are the questions that we want to talk to people about, but, of course, inside of that you have an insurance system in which people are paying premiums and we want to make sure that the program is there for premium payers.

On the four of ten workers qualifying for employment insurance, I think the committee should consider a couple of factors. I think when you look at it at any one point in time, you may find that four of the ten people who are unemployed at any one time may not be on employment insurance, with part 1 benefits, but employment insurance, part 2, is available for a much broader spectrum of people.

In Frank's presentation, he talked about the fact that we have both a look back and a reach back function in employment insurance, part 2, so even if you have exhausted EI benefits and you're not captured in that beginning figure, you can come in and get EI part 2 for up to three years. Even if you're looking for a job and unemployed and not counted in the 40% figure, and you were on maternity or parental benefits up to five years ago, you qualify.

When we're thinking about employment insurance, part 2, I think I would be careful with that 40%. My judgment would be that it's a far different number because of the expanded eligibility.

Thank you.

[Ian Shugart]

The only thing I would add, Chair, is that the concern about those at risk of layoff was one of the flexibilities offered in the Canada job grant. Employers can use the Canada job grant for employees that could be at risk of layoff because of outmoded skills, or what have you. They can use the Canada job grant to increase that retraining, so that is a step in that direction as well.

[Randall Garrison, NDP, Esquimalt—Juan de Fuca, BC]

My second question, which kind of flows from that, is about consulting the stakeholders. Admittedly, I haven't been here for all the presentations, but I don't see anything where those who actually are collecting employment insurance, the workers, are being consulted as part of the labour market development agreement renewals.

We know that some of the unions running employment help centres are receiving support from the United Way, particularly in Ontario. There are quite a few unions that are running their own centres trying to help their members get back to work. I wonder if there's a place for them in these consultations and in the decisions about where training dollars should go, based on their on-the-ground experience.

[The Chair, Conservative, Phil McColeman]

Again, I'm going to have to cut it off there.

I'm pretty strict on time because we have limited time with you here just for the first hour, so we'll go on Mr. Mayes for five minutes.

[Colin Mayes, Conservative, Okanagan—Shuswap, BC]

Thank you, Mr. Chair.

I'm interested in what I have in my notes here on these performance indicators that the department uses to ensure that the plan is fully accessed and the costs and benefits of the program.

One of the experiences we have in British Columbia is that we're right next door to a very prosperous province that has high labour demands. We're finding that especially the youth are going there and working in camps, making big money, coming back, and then collecting EI.

Then, of course, as part of that benefit, they have to be actively looking for work or be retrained. We're funding that, and then all of a sudden they don't show up. I've talked with those in the service or training delivery of the program, who have said that they just don't show up. It's really a challenge to get them back, because they work this into their career. They work, make big money, and come back and collect EI. This is a little bit of an issue, as I say, especially for British Columbia, because we have such an opportunity for youth to go into the oil patch or to Fort McMurray, “Fort Mac”.

There is a right to access EI, and I understand that, but there's also a responsibility to the system. I was wondering, as far as your review of things goes, are there any ways that we can safeguard that type of access to the system? Can we try to make it so that we can help youth look beyond just the year-to-year to a future in a trade or to some sort of training that they should get and that would make them desire to be a permanent employee? Also, working with the employers...?

[Frank Vermaeten]

Thanks for that question.

I think you pointed to a pretty big challenge in trying to provide that right balance of getting individuals to have the incentive to look for work and to keep a job, and then trying to figure out what the best game plan is going forward. That's a really complex issue.

I think the government is trying to proceed on various fronts on that question. I think one is on making sure that individuals have an incentive to take work and then stay at it. We have an initiative the government introduced about 18 months back. It's called “Connecting Canadians with Available Jobs.”

The initiative there was to try to make sure that, on the one hand, individuals have the labour market information to be able to look at what jobs are available to them, and then at the same time to set out the obligations for unemployed individuals, to make sure that if they do lose their job, or leave a job, governments look at this carefully to see if they are making active efforts to try to find work or to keep work. We ask them to keep a record of that, to keep a journal, and to say, “These are the things I'm doing to try to find a job.” We describe exactly what kind of job that individual should be prepared to accept. That incentive structure I think is there increasingly to make sure that individuals are keeping a job and looking for a job.

I think you're absolutely right in terms of thinking beyond that to ask, “Is it any job or is it the right job?” I think this is where we're looking at both the LMAs and the LMDAs to ask if we can have a better match for the individual and the job market, and also for the job that's going to be there a few years out. Yes, you need good labour market information, but you also need employer involvement. Employers do have that medium-term perspective in terms of saying that there's an LNG project, and three years out, this is who they're going to need for it, and five years out, this is what they're going to need. We need to try to partner up with employers to make sure that we and the provinces and territories are training people for the jobs of tomorrow that are going to be there—and the good jobs.

[The Chair, Conservative, Phil McColeman]

Thank you.

You're actually giving 10 seconds to me because I'm going to take an opportunity here to ask a couple of questions. I want to kind of give some perspective on what you were saying with the involvement of employers and, in particular, on when you suggested that the Canada job grant would be an option for an existing employer to look at before they laid someone off as an option to enhance their own workforce.

I had a company with approximately 20 employees on average in the renovation business. There were times when we didn't have enough work, and I had to lay people off, but it's tough in a small company. As we know, small companies operate—what?—the percentage is 80% of our economy, and typically in real-world Canada, there are close personal connections to your employees in these small companies.

I've always said that the most difficult thing to do was to lay someone off, worse yet, have to fire someone, but I'd just like a couple of brief comments on the outreach part of what you've discussed, if you could. The outreach part of what you talked about really resonated with me, as well as your comments in terms of the delivery of these actually active service people within the employment insurance area, the part II part of it, reaching out to employers at the time of a layoff, let's say, or a potential layoff, when someone comes in.

Perhaps someone could call that employer back and ask, “Did you know that you could do this as a measure?” This is particularly useful with small companies because many owners wouldn't know that. That kind of opportunity I think would be helpful to many small companies, so I'd appreciate maybe a couple of closing comments along those lines.

[Ian Shugart]

Thank you, Chair.

You've articulated a number of challenges, as all members have and, frankly, given us a lot to think about as we go from here.

On the first point, I don't think any program or network of programs can completely insulate the labour market from the ups and downs and the vagaries of economic activity, but the goal is to provide for people when those things happen; that's EI part I.

What we want to do is to use the labour market agreements, that's the Canada job fund and the LMDAs now, to shorten the pipeline, if you like, between that kind of business decision, the training decision, and the impact on workers.

John described the reach-back, the look-back provisions. We think that that is a sensitive element of EI part II that allows for some of that insulation. Add to that the Canada job grant ability of employers to provide the prospect of a real job at the end of training, but it's in the context of avoiding layoff, maybe retooling in the direction that the business needs to go or where there is more economic opportunity.

Given that we've got the agreements in principle and leading to the formal agreements with the provinces on the Canada Job Fund, we're optimistic that that will now become part of the suite of programs that the employment centres that Frank talked about, the contact centres, will make available to employers.

We're also open to the employers coming together in areas where there might be concern about someone else getting the benefit of that training, of employers coming together in consortia and taking advantage of the Canada job grant, or presumably, one could be doing this through the LMDAs as well, so that a broader pool of workers is trained up for areas that a particular sector or region of the country might be going to in the future.

So I think what we want is a system that is more adept, more adjustable to the rapid changes in the economy, and we think that greater involvement in the decision-making by employers and labour has a role to play in this as well because they've got a role in the training institutions, the training process. If we can shorten those decision periods and make the programs offered through the LMDAs more sensitive to those realities, we think that the kind of situation that you described.... Nothing will be perfect, but we'll have a training system that is more sensitive to those ups and downs.

[The Chair, Conservative, Phil McColeman]

Good. Thank you for that.

Gentlemen, thank you for coming today and for giving us an hour of your time.

Frank, I would echo what's been said around the table. Congratulations on what you've achieved here, and all the best going forward from this committee.

Yes, Mr. Cuzner.

[Rodger Cuzner, Liberal, Cape Breton—Canso, NS]

Just in line with my comments about the labour market information, in the spirit of helping with the study here, could I put forward a motion to that end, requesting that information? I could read it into the record.

[The Chair, Conservative, Phil McColeman]

Could you maybe save that for the end, under committee business?

[Rodger Cuzner, Liberal, Cape Breton—Canso, NS]

Well, I'm heading out shortly, so can I perhaps read it now?

[The Chair, Conservative, Phil McColeman]

Okay. We'll do this as just a quick consideration.

Mr. Cuzner, proceed.

[Rodger Cuzner, Liberal, Cape Breton—Canso, NS]

I'll just read this in: That the committee request that the department provide an analysis of what it has done, or plans on doing, to improve labour market information to measure accurate and relevant information and specifically explain what recommendations have not been implemented, and why, from the 2009 labour market information panel chaired by Don Drummond.