Back to Work: Canada

Improving the Re-employment Prospects of Displaced Workers

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Job displacement (involuntary job loss due to firm closure or downsizing) affects many workers over their lifetime. Displaced workers may face long periods of unemployment and, even when they find new jobs, tend to be paid less than in their prior jobs. Helping them get back into good jobs quickly should be a key goal of labour market policy. This report looks at how this challenge is being tackled in Canada. While the Canadian government uses several measures to prevent unnecessary layoffs, the focus is placed on assisting workers after they have lost their job via the Employment Insurance system and the core labour market programmes operated by the Provinces. Re-employment assistance tailored to meet the specific needs of displaced workers also plays a useful role, but needs to be reinforced so as to start the adjustment process earlier for workers receiving advance notice or a large severance payment and to reach  workers affected by small-scale displacements. Targeted programmes for older displaced workers with long-tenure who are hardest hit have yet to reach a large share of this group.

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Re-employment support for displaced workers in Canada

This chapter describes the main active labour market programmes available to help displaced workers get back to work quickly as well as retrain, when necessary. Canada primarily relies on general job-search assistance and skills development programmes to assist displaced workers and these services appear to be well suited to assist the majority of displaced workers to find suitable jobs quickly. However, a substantial number of displaced workers require more intensive job-search assistance and relatively few appear to receive it via general employment services. Canada also implements several targeted measures for older and long-tenured displaced workers that provide more intensive adjustment assistance tailored to the needs of these groups. These programmes are promising but currently reach only a small share of displaced workers and are not well established as permanent programmes.

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