Sys­tem of em­ploy­ment in­sur­ance con­tains dis-in­cen­tives


In our cur­rent sys­tem of em­ploy­ment in­sur­ance, we have at least two dis- in­cen­tives I am aware of that keep peo­ple on un­em­ploy­ment longer than they likely should. The first is the well- known sea­sonal na­ture of a num­ber of jobs in­volv­ing a spe­cific skill- set that is not very trans­fer­able to other jobs in other sea­sons.

Em­ploy­ment in­sur­ance be­comes a well-es­tab­lished and even de­pen­dent year-round pro­gram, or a sec­tion of high­way fol­lowed by an equally long bridge, then high­way, bridge, and high­way, in a never-end­ing and ex­pen­sive loop go­ing nowhere.

The sec­ond dis- in­cen­tive is the cir­cum­stance of a well-pay­ing job of a sec­ond wage earner in a fam­ily with chil­dren and child­care ex­pens- es. I re­cently talked to a wo­man who makes $45,000 a year at her job, but be­cause of the child care ex­penses as­so­ci­ated with hav­ing to work, ac­tu­ally nets $200 a month more if and when she gets laid off and is at home car­ing for the chil­dren her­self and col­lect­ing em­ploy­ment. Why would she even try to go back to work un­til her un­em­ploy­ment ran out?

There are more jobs avail­able in the prov­ince now than there has been in a long time, and em­ploy­ers are hear­ing po­ten­tial em­ploy­ees turn down jobs un­til “their” un­em­ploy­ment runs out. While that is a log­i­cal choice, it is also a large state­ment that the EI sys­tem is more bro­ken than ever. We can’t just shrug aside the no­tion that it’s eas­ier, and more cost ef­fec­tive for peo­ple to stay on un­em­ploy­ment.

The idea of be­ing em­ployed more of­ten than not must in­clude the in­cen­tives that go along with that goal, other­wise, we’re go­ing to find our­selves driv­ing off that bridge into a long, dark, sub­ter­ranean tun­nel, and no turn­around at the end. All of a sud­den, sub­ma­rine mon­i­tor­ing is look­ing pretty good again.

Alex Harrold writes from West­port. He can be reached at


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