Canada could do more to help laid-off workers


7/7/2015 - Improved employment services would help laid-off workers in Canada find a new job more quickly, according to a new OECD report.


Back to Work: Canada says that 2.2% of Canadian workers with at least one year of tenure are laid off each year when their company goes bankrupt or downsizes. Just under half of them find a new job within one year, and almost two-thirds within two years.


But many face significant earnings losses when rehired, with one in five having hourly wage cuts of 25% or more in their new job. Older workers with relatively long job tenure are particularly vulnerable: they are less likely to find a new job and, when they find, are likely to earn much less. Often, they also have to accept part-time or temporary work.


Canada has a range of services in place to avoid unnecessary redundancies and minimise the adverse consequences of retrenchment, especially for workers affected by mass layoffs. But intense adjustment assistance and early intervention services are not universal, leaving many displaced workers with insufficient re-employment support.


To help address these challenges, the OECD recommends that Canada:


  • Improve co-ordination between federal and provincial governments in the design, delivery and implementation of employment support.
  • Make early intervention services more effective for mass dismissals by raising incentives to co-operate for employers, employment services and affected workers.
  • Extend effective early intervention services as much as possible to workers affected by small-scale or individual lay-offs.
  • Connect people to available employment services quickly, including those who receive severance pay.
  • Consider extending the duration of Employment Insurance benefits with degressive benefit payment over time, accompanied by systematic monitoring of job search and mandatory participation in active labour market programmes.
  • Expand access of older long‑tenured displaced workers to more intensive job‑search assistance, case management and training.
  • Increase expenditures on active labour market programmes, particularly for general skills training, and put in place contingency plans for increased spending needed to cope with a deep economic downturn.


The report is available at:


Read more about the OECD "Back to work" series:


For further information or comment, journalists should contact the authors of the report from the OECD’s Employment Policy Division: Gwenn Parent (tel. + 33 1 45 24 75 01) and Shruti Singh (tel. + 33 1 45 24 19 48).



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