The number of Canadians collecting Employment Insurance (EI) benefits has reached the lowest amount ever since the federal government began keeping records on the matter in 1997, a new Statistics Canada study finds.
The agency says that 375,000 Canadians received regular EI benefits during the month of January, which was down by about 20,000 from December 2022, representing a drop in recipients of 5 percent.
The agency noted that it was excluding the seven-month period at the beginning of the pandemic when the Canadian Emergency Response Benefit was available from March to September 2020, during which time EI collections spiked.
The largest declines in recipients were among young people aged 15-24 years old, with the number of female recipients in that age group declining by 74 percent and male recipients declining by almost 60 percent.
EI Decline
The steady downward trend of EI recipients across the country follows a record-high peak of over 1.6 million beneficiaries in May 2021—a little over a year after pandemic lockdowns began.Since then, the rate has declined almost every month.
Statistics Canada added in its report that, despite EI rates decreasing by a large margin nationwide, the country’s unemployment rate held steady at 5 percent in January, which was just above the record-low in June and July 2022 of 4.9 percent.
The report also showed that the proportion of long-term unemployment—which it defines as individuals continuously unemployed for 27 weeks or more—was down by around 4 percentage points in January compared to a year prior, going from 19.9 percent in 2022 to 15.8 percent this year.
Jimmy Jean, vice president and chief economist of the Desjardins Group, told the Commons Standing Committee on Finance on March 23 that he is anticipating Canada’s unemployment rate to rise by about 2 percentage points in 2023 and end the year at around 7 percent.
Jean added that the “conditions are in place” for a recession to occur over the next several quarters, but said he still expects the national inflation rate to trend downward.