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Introduction and Background


Like many other OECD countries, Canada has experimented with a variety of job creation programs over the last twenty-five years.These can be loosely classified as “direct” and ‘indirect” job creation measures, even though the distinction may often appear to be somewhat blurred.

  • The main emphasis of direct job creation measures is to create jobs that are of a short-term nature to reduce the number of unemployed, reduce dependence on social programs, and to some extent stimulate the economy to create jobs on a longer term basis. Canada Works and the Local Initiatives Program would be typical examples of direct job creation programs in the Canadian context.

  • Indirect job creation programs are aimed at improving the employability of job-seekers and increasing the level of long-term employment with greater emphasis on training and skill development. The Employer Wage Subsidy and Self-Employment Incentive\Assistance programs are examples of indirect job creation programs.

The purpose of this study is to provide a brief review of direct job creation programs and draw some lessons learned on the basis of evaluation studies that have been done from time to time. The evaluation studies have not followed consistent methodology and the findings are scattered in numerous reports. Therefore, this study attempts to bring the evaluation findings into a common focus with a view to drawing inferences as to what works and what does not work.

The direct job creation programs focused in this review generally correspond to the definition used by the OECD in its reports (OECD, 1980, 1997). The list of programs covered in this report does not, however, pretend to be exhaustive. Instead, the list was determined by two criteria. Some programs were selected for this review because they were large in terms of program expenditure. More often, however, programs were selected because they had a relatively long life and hence had been subjected to a formal program evaluation.

Unless otherwise stated, job creation in this report refers to federal direct job creation initiatives in the public sector and excludes direct job creation programs initiated by provinces.

It seems appropriate to point out that several difficulties are encountered in this kind of exercise.

  • First, some programs were in operation only for a short period of time and were discontinued even before a formal evaluation was completed. In such cases, a complete evaluation report is unavailable and program data are rather sketchy.

  • Second, when a new government came to power, quite often the main structure of an existing program was retained but the program title was changed giving the impression of a new job creation program.

  • Third, the available data on the job duration of program participants and on program expenditures do not always match. For example, sometimes program participation data refers to weeks of employment during the calendar year, while program expenditures have been reported for the financial year. The lack of matching data makes it difficult to estimate the cost of job creation by program. For this reason, costs of job creation are presented in this report only for those programs where the calculation was possible and meaningful. In addition to information from past evaluation studies, program administration data and Departmental Annual Reports have been used to supplement statistical information.


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