In July 2015, the workforce participation rate in New Brunswick stood at 62.8%, compared with a national rate of 65.7% (Statistics Canada, 2015). That means that over 37% of New Brunswick is not working or actively seeking work. With an unemployment rate of 11%, over 32,000 New Brunswickers are current beneficiaries of employment insurance (EI). Each case of EI benefit is unique, and most people benefitting from these programs genuinely need the support for a time of transition (i.e. job search, relocation, family), however these were never intended to be long-term benefits.
Aboriginal Peoples in NB are faced with even greater statistical challenges. The 2013 Profile of the New Brunswick Labour Force puts the Aboriginal workforce participation rate at just 61.2%. The unemployment rate in the same report was 20.8%.
One of the most polarizing moves of the federal government in the last few years was changes made to employment insurance (EI). The reforms targeted repeat users, requiring EI recipients to commute up to one hour and accept work that paid 70% of their previous income. These changes were met with mixed reviews. Some applauded the federal government for taking action on a system that is perceived to be abused by repeat users. Others slammed the government for hitting the middle class where it hurts, in their wallet. So, is this approach ideal for Canada?
A recent article in The Economist summarized an analysis by the National Bureau of Economic Research (NBER) that examined over 200 recent labour market programs around the world. These programs were intended to get people back to work, and were divided into two streams: “work first”, and training to employment. The “work first” approach that mandates return to work leads to immediate positive results, however those benefits quickly fade. On the flip side, “cuddlier programmes that offer training are disappointing in the short-term, but blossom over time” (The Economist, 2015).
The research suggests that training-to-employment career development programs result in greater long-term employment than other approaches. As money is invested into training, workforce participation rates will increase over the long-term.
Training-to-employment programs are prevalent in building Aboriginal workforce participation in New Brunswick. The Joint Economic Development Initiative Inc. (JEDI) has partnered with Aboriginal communities, tribal councils, and post-secondary institutions on training-to-employment programs in mining, energy, trades, and information technology sectors. These, along with other programs, are invaluable in building Aboriginal workforce capacity and employing Aboriginal people in NB.
The 2015 federal budget contains many areas of funding that represent this long-term, positive approach. Nearly $300 million were budgeted through the Aboriginal Skills and Employment Training Strategy (ASETS) and the Skills and Partnership Fund (SPF). The ASETS is a long-term approach projected to invest close to $1 billion into training-to-employment in Aboriginal communities across Canada from 2014-2018 (Employment & Skills Development Canada, 2015).
On one hand, EI reform represents a “work first” approach to employment in Aboriginal communities, while significant investment in training-to-employment is also occurring. The research is clear; training-to-employment is the best strategy moving forward to engage Aboriginal Peoples in the New Brunswick workforce over the long term.
With an aging workforce resulting in growing labour shortages and a young Aboriginal population, training-to-employment programs will be a key driver for the future of New Brunswick.
The Economist(2015): How governments should help those on the dole. Retrieved from: http://www.economist.com/blogs/freeexchange/2015/08/cutting-unemployment.
Employment stats retrieved from Statistics Canada (2015), Employment and Skills Development Canada (ESDC), and the Profile of the New Brunswick Labour Force (2013).
Mike Hennessey, Aboriginal Labour Market Information Analyst, will be a monthly contributor to the JEDI blog. From Pabineau First Nation, Mike holds a Bachelor of Business Administration from the University of New Brunswick and is currently finishing a Masters of Education at UNB. Mike is motivated to share relevant labour market information to help First Nations, industry, and government recognize the potential that lies in the Aboriginal workforce.