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Bill C-17 rather quietly imposed what are probably the largest cutbacks in Canada's Unemployment Insurance (now Employment insurance) system since it was first introduced, both making it harder for individuals to qualify for a claim at all, and reducing the number of weeks of benefits claimants were entitled to by as much as 16 weeks, depending on their employment history and local labour market conditions. In this report we examine which workers — in terms of province, industry and gender — were hurt the most by these benefit cuts, as well as the extent to which workers were able to make changes in their economic behaviour that cushioned the impact of those cuts.

Overall, we find that Bill C-17 reduced the number of benefit weeks for which a separating worker was eligible by 7.6 weeks for both men and women, and reduced the number of benefit weeks actually received in an average UI claim by about 3 weeks for men and 4 weeks for women. Interestingly, not only are these losses fairly similar across gender lines, they also exhibit only modest variation by province or by industry. Losses are, however higher in the high-unemployment provinces and industries, with — for example — Newfoundland experiencing the largest provincial receipt loss per claim of 5.1 weeks for women, and fishing the largest industrial receipt loss per claim of 6.1 weeks, again for women.

A key reason why C-17-induced losses per separation do not vary more dramatically across provinces and industries concerns behavioural changes in qualifying weeks, concentrated in the high-unemployment provinces and industries. Especially in those provinces and industries, we find that workers were able to accumulate enough extra weeks of work to substantially mitigate the effects the Bill would otherwise have had on their UI eligibility. While in some cases —notably the fishing industry — these extra weeks of work may have been the results of other, compensatory government programs, they play an important role in determining the ultimate industrial and regional impact of the UI cutbacks in Bill C-17 whatever their source.

Finally, while C-17's impact on UI eligibility and receipt per job separation were surprisingly equally distributed across provinces and industries, it is important to note that its per worker, or per-capita impact was not. Because workers in high-unemployment provinces and industries (essentially the Atlantic provinces and to some extent Quebec, and the primary industries plus construction) are much more likely to experience a job separation, a randomly selected worker in those provinces and industries could expect to lose many more weeks of UI benefits than a worker elsewhere in Canada due to C-17. For example, an average women employed in the fishing industry, and an average man employed in the forestry industry, both collected about 25 weeks of UI benefits per year before the introduction of C-17, a number which fell by 5 weeks to 20 after C-17. Canada-wide, average weeks of UI receipt fell by about one week per worker, from about 5 to 4 for women and 6 to 5 for men. It follows that, while clearly having a disproportionate impact on those provinces and industries which were the highest users of the UI system, Bill C-17 has not, by any means, ended the massive cross-subsidization of provinces east of the Ottawa River, and of the agricultural, fishing, forestry, and construction industries, by the other provinces and industries in Canada.