Evaluation of the Canada-Nova Scotia Labour Market Development Agreement

Effectiveness and efficiency of EBSMs

Overall, incremental impacts demonstrate that participation in SD and EAS improves labour market attachment and reduces dependence on government income supports compared to similar non-participants. These results are consistent with those found for earlier cohorts of participants as part of the previous evaluation cycle. A subgroup analyses shows that with some exceptions, SD and EAS interventions also improve the labour market attachment and reduce the dependence on income support for most subgroups of participants. As well, for most interventions, the social benefits of participating in EBSMs exceed the initial investment costs over time.

Chart i presents the incremental impacts on the incidence of employment for active and former claimants by EBSM. The estimates can be interpreted as a chance in the probability of being employed following participation. For example, participation in SD increases the probability of being employed by 4.8 percentage points for active EI claimants relative to non-participants.

• Note: Impacts are estimated over 4 post-program years for SD and 5 years post-program for EAS.

Text description Chart i

Program name	Incidence of employment for active claimants (percentage points)	Incidence of employment for former claimants (percentage points)
Skills Development	4.8	5.3
Employment Assistance Services	1.1	n/a

• Note: Impacts are estimated over 4 post-program years for SD and 5 years post-program for EAS.

Chart ii presents the annual average increase in employment earnings for active and former claimants over the post-participation period.

• ¹ While the annual average increase in employment earnings over the 5 post-program years is not statistically significant, EAS participants increased their employment earnings in years 3 and 4 post-program by $1,039^** and $655^* respectively.
• Note: Impacts are estimated over 4 post-program years (or 5 years in the case of EAS).

Text description Chart ii

Program name	Employment earnings for active claimants ($)	Employment earnings for former claimants ($)
Skills Development	3,739	2,307
Employment Assistance Services	3671	n/a

• ¹ While the annual average increase in employment earnings over the 5 post-program years is not statistically significant, EAS participants increased their employment earnings in years 3 and 4 post-program by $1,039^** and $655^* respectively.
• Note: Impacts are estimated over 4 post-program years (or 5 years in the case of EAS).

As shown in Chart iii. overall active and former claimants reduce their dependence on government income supports.

• Note: Impacts are estimated over 4 post-program years for SD and 5 post-program years for EAS.

Text description Chart iii

Program name	Dependence on government income supports for active claimants (percentage points)	Dependence on government income supports for former claimants (percentage points)
Skills Development	-2.9	-2.3
Employment Assistance Services	-1.8	n/a

• Note: Impacts are estimated over 4 post-program years for SD and 5 post-program years for EAS.

Table ii presents the number of years required for the social benefits to exceed program costs. Social benefits to participation exceed initial investment costs over a period ranging from 7.8 to 12.6 years. As well, for the first time, additional analysis is conducted to estimate the impact of participation in EBSMs on public health care costs. For example, for SD active claimants, the average total discounted benefit to the government and society from the reduction in public health care cost is $388 per participant over 10 years post participation period.

Outcomes of EBSMs

Incremental impacts for START and JCP are not produced due to the small samples or due to the models used to estimate the incremental impacts not balancing. Having balanced models is an essential condition to ensure that participants and non-participants are similar. However, outcomes can still be examined for participants in order to describe the average changes that occur from before to after program participation.

Outcomes for both active and former claimant participants in START and JCP show increases in employment earnings from 5 years before program participation to 4 years after. As well, decreases are found in receipt of EI benefits and dependence on government income supports after participation.

Supplemental studies

A series of supplemental studies addresses information gaps previously identified in LMDA evaluations regarding the design and delivery, challenges and lessons learned for Self-Employment, JCP, the Sector Council Program, and Research and Innovation.

Most of these interventions are not suitable for incremental impact analysis. For example, the Sector Council Program and Research and Innovation do not collect participant information. As a results, a mix of qualitative and quantitative methods are used to examine these EBSMs in detail. Key considerations are included to help guide future program and policy discussions.

Sources of data and information

The analysis takes into account all the quantifiable costs and benefits directly related to EBSM delivery and participation that can be measured given the information available. The analysis is comprehensive in that it accounts for the vast majority of possible direct costs and benefits.

However, the analysis does not account for all costs and benefits. For example, there are factors that can lead to an understatement of the benefits (for example, positive spillovers to other family members) and other factors that can lead to an overstatement of the benefits (for example, effects on skill prices or displacement).

This study relied on integrated data from the EI Part I and II Databank and Income Tax records from the Canada Revenue Agency. Information about earnings, use of EI, and use of social assistance was taken from the study of incremental impacts.^{Footnote 26} The program costs were calculated using information available in the EI Monitoring and Assessment Reports.

Relative to the previous cycle of evaluation, the methodology has been extended to incorporate one of the indirect health benefits associated with increased labour market attachment. In particular, the methodology includes an estimate of the change in public health care cost due to the decline in health care utilization resulting from program participation.

Data on average public healthcare costs by income quintiles are taken from the report Lifetime Distributional Effects of Publicly Financed Health Care in Canada (2013) by the Canadian Institute for Health Information.

Program costs are measured using information on LMDA expenditures and new interventions reported in the EI Monitoring and Assessment Report. Other costs and benefits are assessed using integrated administrative data from the EI Part I and II databank and the Canada Revenue Agency.

Incremental impacts measured over the second year of participation and up to 5 post-program years are discounted by 3% to bring them to a common base with the program cost and benefits incurred in the program start year. This 3% rate accounts for the interest the government could have collected if the funds used to pay for the program had been invested. Incremental impacts are estimated using 2010 constant dollars and this accounts for inflation.

Costs and benefits accounted for in the calculations

Program cost: cost incurred by the government for delivering the program (that is, administration and direct program costs calculated from data reported in the EI Monitoring and Assessment Reports).

Marginal social cost of public funds: loss incurred by society when raising additional revenues such as taxes to fund government spending. The value is estimated as 20% the program cost, sales taxes, income taxes, impacts on EI and impacts on SA paid or collected by the government.

Foregone earnings: estimated net impacts on participants’ earnings during the participation period. During labour market program participation, some individuals have lower earnings than what they would have received if they had not participated.

Employment earnings: incremental impacts on participants’ earnings during and after participation. In-program earnings represent the foregone earnings for participants.

Fringe benefits: the employer-paid health and life insurance as well as pension contributions. They are estimated at 15% of the incremental impacts on earnings.

Federal and provincial income taxes: incremental impacts on federal, provincial and territorial taxes paid by participants.

Sales taxes: the sales taxes paid by participants estimated as incremental impacts on earnings multiplied by the propensity to consume (97%), the proportion of household spending on taxable goods and services (52%) and the total average federal and provincial sales tax rate (11%).

Social assistance and Employment Insurance benefits collected: incremental impacts on SA and EI benefits use by participants following participation.

Canada Pension Plan contribution and EI premiums: these contributions and premiums were identified from the Canada Revenue Agency data and then, the incremental impacts on Canada Pension Plan contributions and EI premiums were estimated.

Public health care costs savings: estimated impact of participation in EBSMs on public health care costs shown as an average change per participant over the post-program period examined.

Incidence of employment

Chart 1 presents the incremental impacts on the incidence of employment for active and former claimants by type of program.^{Footnote 28} The estimates can be interpreted as a change in the probability of being employed following participation.

Active claimants in SD and EAS increase their incidence of employment relative to similar non-participants. Former claimants in SD increase their incidence of employment relative to similar participants who receive only EAS.

• Note: Impacts are estimated over 4 post-program years for SD and 5 post-program years for EAS.

Text description - Chart 1

Program name	Incidence of employment for active claimants (percentage points)	Incidence of employment for former claimants (percentage points)
Skills Development	4.8	5.3
Employment Assistance Services	1.1	n/a

• Note: Impacts are estimated over 4 post-program years for SD and 5 post-program years for EAS.

Employment earnings

Chart 2 presents the average annual increase in employment earnings for active and former EI claimants in the post-participation period. Active EI claimants who participate in SD and EAS increase their annual employment earnings relative to similar non-participants.^{Footnote 29} Former EI claimants who participate in SD increase their employment earnings relative to similar participants who receive only EAS services.

• ¹ While the annual average increase in employment earnings over the 5 post-program years is not statistically significant, EAS participants increased their employment earnings in years 3 and 4 post-program by $1,039^** and $655^* respectively.
• Note: Impacts are estimated over 4 post-program years (or 5 years in the case of EAS).

Text description - Chart 2

Program name	Employment earnings for active claimants $)	Employment earnings for former claimants ($)
Skills Development	3,739	2,307
Employment Assistance Services	3671	n/a

• ¹ While the annual average increase in employment earnings over the 5 post-program years is not statistically significant, EAS participants increased their employment earnings in years 3 and 4 post-program by $1,039^** and $655^* respectively.
• Note: Impacts are estimated over 4 post-program years (or 5 years in the case of EAS).

Use of EI benefits

As shown in Chart 3, active claimants in SD and EAS reduce their use of EI benefits in the post-program period compared to similar non-participants. In the post-program period, former claimants in SD increase their EI benefits use relative to similar participants who receive EAS services only.

In the case of SD former claimants, the increase in the use of EI is consistent with previous evaluations and is not necessarily a negative impact. Following participation, former claimants are likely to requalify for EI benefits due to their stronger labour market attachment demonstrated by increases in employment and earnings.

• Note: Impacts are estimated over 4 post-program years for SD and 5 post-program years for EAS.

Text description - Chart 3

Program name	Use of EI benefits for active claimants ($)	Use of EI benefits for former claimants ($)
Skills Development	-$319	$323
Employment Assistance Services	-$608	n/a

• Note: Impacts are estimated over 4 post-program years for SD and 5 post-program years for EAS.

Use of SA benefits

As shown in Chart 4, active and former EI claimants who participate in SD decrease their use of SA benefits in the post-program period.

Active EI claimants in EAS increase their use of SA benefits compared to similar non-participants.

• Note: Impacts are estimated over 4 post-program years for SD and 5 post-program years for EAS.

Text description - Chart 4

Program name	Use of SA benefits for active claimants ($)	Use of SA benefits for former claimants ($)
Skills Development	-$57	-$227
Employment Assistance Services	$61	n/a

• Note: Impacts are estimated over 4 post-program years for SD and 5 post-program years for EAS.

Dependence on income support

As shown in Chart 5, active EI claimants in SD and EAS, as well as former claimants in SD reduce their overall level of dependence on income support (combined EI and SA benefits). The estimates can be interpreted as a change in the probability of receiving EI or SA benefits following participation.

• Note: Impacts are estimated over 4 post-program years for SD and 5 post-program years for EAS.

Text description - Chart 5

Program name	Dependence on government income supports for active claimants (percentage points)	Dependence on government income supports for former claimants (percentage points)
Skills Development	-2.9	-2.3
Employment Assistance Services	-1.8	n/a

• Note: Impacts are estimated over 4 post-program years for SD and 5 post-program years for EAS.

Female participants

Nearly 10,900 EI active and former claimant participants in LMDA programs and services, between 2010 and 2012 are female, representing nearly 54% of participants.

The profile of female participants is presented in Table 4 by age, sociodemographic group, and marital status. Information about their educational attainment, occupation and industry is based on the latest job they held prior to applying for EI Part 1 benefits. Information about sociodemographic groups is self-reported.

• Note: Values may not equal 100% due to rounding or missing information.

Top 3 occupational groups for female participants prior to participation^{Footnote 30}

Active claimants:

• clerical personnel = 22%
• intermediate sales and service personnel = 18%
• other sales and service professionals = 12%

Former claimants:

• clerical personnel; intermediate sales and service personnel = 22% each
• other sales and service professionals = 15%
• other Manual Workers = 6%

Top 3 industries for female participants prior to participation^{Footnote 31}

Active claimants:

• administrative and support, waste management and remediation services = 15%
• retail trade = 14%
• accommodation and food services = 13%

Former claimants:

• administrative and support, waste management and remediation services = 16%
• retail trade; accommodation and food services = 14% each
• health care and social assistance = 11%

Male participants

Nearly 9,200 EI active and former claimant participants in LMDA programs and services between 2010 and 2012 are male, representing nearly 46% of participants.

The profile of male participants is presented in Table 6 by age, sociodemographic group, and marital status. Information about their educational attainment, occupation and industry is based on the latest job they held prior to applying for EI Part 1 benefits. Information about sociodemographic groups is self-reported.

• Note: Values may not equal 100% due to rounding or missing information.

Top 3 occupational groups for male participants prior to participation

Active claimants:

• other manual workers = 22%
• semi-skilled manual workers = 20%
• skilled crafts and trades = 16%

Former claimants:

• other manual workers = 24%
• semi-skilled manual workers = 17%
• skilled crafts and trades = 15%

Top 3 industries for male participants prior to participation^{Footnote 32}

Active claimants:

• construction = 17%
• manufacturing = 15%
• administrative and support, waste management and remediation services = 13%

Former claimants:

• construction = 18%
• manufacturing; administrative and support, waste management and remediation services = 14% each
• retail trade = 9%

Youth participants

Nearly 7,000 EI active and former claimant participants, between 2010 and 2012, were 30 years of age or younger when they began their program participation in Nova Scotia, representing about 35% of participants.

The profile of youth participants is presented in Table 8 by gender, sociodemographic group, and marital status. Information about their educational attainment, occupation and industry are based on the latest job they held prior to applying for EI benefits. Information about sociodemographic groups is self-reported.

• Note: Values may not equal 100% due to rounding or missing information.

Top 3 occupational groups for youth participants prior to participation^{Footnote 34}

Active claimants:

• other manual workers = 18%
• clerical personnel = 17%
• intermediate sales and service personnel = 13%

Former claimants:

• clerical personnel = 18%
• other manual workers; intermediate sales and service personnel = 16% each
• other sales and service professionals = 15%

Top 3 industries for youth participants prior to participation^{Footnote 35}

Active claimants:

• administrative and support, waste management and remediation services = 16%
• retail trade = 12%
• accommodation and food services = 11%

Former claimants:

• administrative and support, waste management and remediation services = 19%
• retail trade; accommodation and food services = 13% each
• construction = 10%

Older worker participants^{Footnote 36}

Nearly 1,850 EI active and former claimant participants, between 2010 and 2012, were 55 years of age or older when they began their program, representing nearly 10% of participants.

The profile of older worker participants is presented in Table 10 by gender, sociodemographic group, and marital status. Information about their educational attainment, occupation and industry are based on the latest job they held prior to applying for EI benefits. Information about sociodemographic groups is self-reported.

• Note: Values may not equal 100% due to rounding or missing information.

Top 3 occupational groups for older worker participants prior to participation^{Footnote 37}

Active claimants:

• clerical personnel; semi-skilled manual workers; intermediate sales and service personnel = 13% each
• skilled crafts and trades workers; other sales and service personnel = 11% each
• other manual workers = 10%

Former claimants:

• clerical personnel; intermediate sales and service personnel = 15% each
• other sales and service personnel; other manual workers = 12% each
• semi-skilled manual workers = 11%

Top 3 industries for older workers participants prior to participation^{Footnote 38}

Active claimants:

• manufacturing; administrative and support, waste management and remediation services = 13% each
• retail trade = 11%
• construction = 9%

Former claimants:

• administrative and support, waste management and remediation services = 13%
• manufacturing; retail trade; health care and social assistance = 10% each
• construction = 9%

Skills Development (SD)^{Footnote 40}

During the 2010 to 2012 period, SD represents 62% of EBSM expenditures under the LMDAs in Nova Scotia. The average duration of an SD Action Plan Equivalent is 68 weeks for active claimants and 69 weeks for former claimants.

As shown in Table 12, over the 10-year post-program period the benefit for active claimants is +$9,152 higher than the costs, yielding a social return of 56% on investment. This means that if the government spends $1 on SD for active EI claimants, it generates +$1.56 of benefit for society. It takes 7.8 years for the benefits to recover the costs of programming. Overall, there is a savings to health care costs of $311 per participant.

The benefit for former claimants is +$1,047 higher than the costs, yielding a social return of 6% over the 10-year post-program period. This means that if the government spends $1 on programming, it generates $1.06 of gain for society. From a social perspective it takes 9.7 years of society to recover the costs of SD for former EI claimant participants. Overall, there is a savings to health care costs of $212 per participant.

Employment Assistance Services (EAS)

EAS includes a variety of services such as computer access for job search services, group sessions to prepare for an interview, career counselling, and action plan development. The administrative data, however, do not allow to identify what proportion of EAS interventions belong to each category or the intensity of services offered to participants.

While EAS are often provided with other EBSMs, this analysis examined only participants who received one or more EAS without participating in other EBSMs. EAS represents 25% of total EBSM expenditures between 2010 and 2012 in Nova Scotia.

The average length of an EAS-only Action Plan Equivalent is 18 weeks compared to between 68 weeks for active EI claimant participants in SD.

As shown in Table 12, over the 5-year post-program period the benefits for active claimants in EAS is -$3,416 lower than the costs, yielding a social return on investment of -198%. This means that if the government spends $1 on EAS for active claimants, it generates a -$0.98 loss for society.

Five years after participation the benefits are negative. Participants’ earning gains, which start in the second-year post-program, and do not compensate for the loss experienced during EAS participation and in the first year after participation. Assuming that the average benefits measured from the second to the fifth post-program year are maintained over time, it takes 12.6 years after participation for the benefits to recover the costs.

No savings to health care costs are found.

Overall, the goal of EAS is not to help participants acquire more skills, therefore, increasing participants’ earnings after participation is not necessarily expected. Conducting a cost-benefit analysis for EAS is a challenge as it is not possible to attribute a dollar figure to the return to employment. However, including earnings in the cost-benefit calculation is still very relevant since it captures partially the positive impact of the quicker return to work. 

START participant outcomes

Approximately 575 active and former EI claimant participants, between 2010 and 2012, participated in the START program.

Active claimants

As shown in Chart 6, START participants increase their average earnings from $17,282 in the fifth year pre-program to $21,965 in the fourth year after participation.

Text description - Chart 6

Year in pre-post participation period	Average earnings for active claimant participants
5 years pre-program	$17,282
4 years pre-program	$18,002
3 years pre-program	$17,704
2 years pre-program	$18,697
1 year pre-program	$19,508
Program start year	$12,765
Second year of participation	$16,932
1 year post-program	$19,862
2 years post-program	$22,103
3 years post-program	$21,744
4 years post-program	$21,965

The proportion of employed participants declines from 95% in the program start year, but remains around 86% on average during the post-program period. The proportion of participants on EI Part I decreases from 99% in the program start year to 32% in the fourth year after participation. Participants decrease their dependence on income support from 54% in the program start year to 15% in the fourth year after participation.

Former claimants

As shown in Chart 7, former EI claimant participants in START increase their average earnings from $14,876 in the fifth year pre-program to $19,099 in the fourth year after participation.

Text description - Chart 7

Year in pre-post participation period	Average earnings for former claimant participants
5 years pre-program	$14,876
4 years pre-program	$16,905
3 years pre-program	$16,329
2 years pre-program	$15,226
1 year pre-program	$10,881
Program start year	$11,222
Second year of participation	$17,924
1 year post-program	$18,433
2 years post-program	$19,985
3 years post-program	$20,648
4 years post-program	$19,099

The proportion of employed participants declines from 87% in the program start year, but remains on average around 83% in the post-program period. The proportion of participants on EI Part I decreases from 70% in the program start year to 37% in the fourth year after the participation. Participants decreased their dependence on income support from 39% in the program start year to 19% in the fourth year after participation.

Job Creation Partnerships participants

Approximately 340 active and former EI claimant participants, between 2010 and 2012, participated in JCP.

Active claimants

As shown in Chart 8, JCP active EI claimant participants increase their average earnings from $12,469 in the fifth year pre-program to $20,225 in the fourth year after participation.

Text description - Chart 8

Year in pre-post participation period	Average earnings for active claimant participants
5 years pre-program	$12,469
4 years pre-program	$12,827
3 years pre-program	$14,919
2 years pre-program	$15,599
1 year pre-program	$15,861
Program start year	$8,061
Second year of participation	$12,882
1 year post-program	$17,750
2 years post-program	$19,569
3 years post-program	$19,941
4 years post-program	$20,225

The proportion of employed participants increases from 86% in the program start year, remaining on average around 87% in the post-program period. The proportion of participants on EI Part I decreases from 100% in the program start year to 38% in the fourth year after participation. Participants decrease their dependence on income support from 63% in the program start year to 17% in the fourth year after participation.

Former claimants

As shown in Chart 9, JCP former EI claimant participants increase their average earnings from $13,325 in the fifth year pre-program to $19,202 in the fourth year after participation.

Text description - Chart 9

Year in pre-post participation period	Average earnings for former claimant participants
5 years pre-program	$13,325
4 years pre-program	$15,232
3 years pre-program	$14,429
2 years pre-program	$13,287
1 year pre-program	$8,238
Program start year	$5,089
Second year of participation	$12,354
1 year post-program	$16,053
2 years post-program	$16,712
3 years post-program	$17,602
4 years post-program	$19,202

The proportion of employed participants increases from 64% in the program start year to an average of 77% during the post-program period. The proportion of participants on EI Part I decreases from 52% in the program start year to 32% in the fourth year after participation. Participants decreased their dependence on income support from 46% in the program start year to 25% in the fourth year after participation.

Program design and delivery

The following is a summary of guidelines from Nova Scotia. Key informants did confirm and complement the information found in program guidelines.

The Self-Employment program aims to assist participants in creating employment for themselves by providing them with a range of services including: 

• assistance with business plan development
• counselling, coaching and mentoring
• entrepreneurial training and workshops

Eligible individuals must be unemployed and thinking about starting a new business to create a job for themselves.  Nova Scotia has the flexibility to design and deliver the program to meet its labour market needs. In fall 2018, the program was delivered through third-party organizations, including:

• businesses
• federal or provincial crown corporations
• not-for-profit organizations
• municipal governments
• bands/tribal councils
• public health and educational institutions

Nova Scotia allocates between 7% and 8% of its LMDA funding to the Self-Employment program between fiscal year 2013 to 2014 and fiscal year 2018 to 2019. While spending on the Self-Employment program tends to decrease in Canada, it remains stable in Nova Scotia. 

The application process is structured and aimed to ensure that participants are suited for self-employment, have a viable business idea and the financial resources to launch a business.

Participants’ employment outcomes

The following is a summary of labour market outcomes and satisfaction rates from a survey of Self-Employment participants in Nova Scotia completed in winter 2020.^{Footnote 43} A total of 413 individuals responded to the survey with a 57% response rate.^{Footnote 44}

Self-Employment participants increase their employment level by 15 percentage points from 58% in the year before participating to 73% at the time of survey (that is 2 to 4 years after program participation). The increase is mainly due to an increase in the percentage of self-employed participants.

Type of businesses created, survival rates and success factors

Nearly 45% of survey respondents launched a self-employment business and it was still in operation in winter 2020 (2 to 4 years following program participation). Among the 289 respondents who started a business, 62% of them were still operating their business at 2 to 4 years post-program. Another 3% sold their business, but it was still operational. Thirty percent (30%) of respondents were unable to maintain the operation of the business they started as part of the program.

The business survival rate is consistent with a 2018 Statistics Canada study that found that less than half of unincorporated self-employed individuals continued operations for more than 2 years.^{Footnote 45}

Sixty percent (60%) of self-employment businesses were launched in other services;^{Footnote 46} professional, scientific and technical services; as well as in construction and retail trade.

Regarding factors influencing the success or failure of self-employment businesses:

• participants who started a business and were still in operation at the time of survey attributed their business success to:
  • their dedication, hard work and positive attitude
  • the high demand for their services or products
  • the quality of service provided
  • their own abilities, experience, knowledge and skills
  • their network and business contacts
• participants who started a business but were forced to close it attributed the closure to:
  • poor sales and low revenues
  • small market
  • finding another job
• participants who did not launch a business attributed this to:
  • the level of uncertainty and risk involved
  • the lack of funding
  • workload, work life balance, and underestimating the required commitment

Earning outcomes and reliance on income support

Survey respondents were not comfortable answering questions that related to their earnings. This situation made it difficult to compare the pre- and post-earnings of Self-Employment participants.

Overall, there appears to be an increase in the number of participants reporting less than $10,000 in earnings annually. However, survey respondents, who are able to maintain the operation of their business, are more likely to report earning more or the same as before participating in the program.

As a complement to the earning questions, survey respondents did assess their financial well-being. When considering their entire financial situation:

• 70% of respondents said that they are financially about the same or better off after the program
• 68% of respondents said that their household net worth is about the same or higher after the program

In line with survey findings, key informants state that immediate increases in earnings are not necessarily an expected outcome of the program. 

Regarding the reliance on government income support, participants reduce reliance on the use of EI and SA following program participation.

Satisfaction with services received and current employment

A high percentage of respondents who started a self-employment business report that they are equally or more satisfied with their job situation after program participation. Those who are able to maintain the operation of their business are 22 percentage points more likely to report being more satisfied, compared to those whose business closed (72% compared to 50%).

The survey did examine the contribution of the program to the success of self-employment businesses. At least 79% of survey respondents who launched a self-employment business rate the following services and training as very or somewhat important to the business launch, operation and success:

• one-on-one mentoring / advice or counselling supports
• assistance with business plan development/assessment
• living allowance during participation and financial assistance with business start-up costs
• discussion on risks and challenges of self-employment
• assessment of entrepreneurial readiness
• information about and assistance to access capital
• training on budgeting, financial management, marketing, business operation and sales

Challenges and lessons learned related to program design and delivery

The following is based on key informant interviews with program managers, career practitioners and service providers.

Key informants identify the following challenges related to program design and delivery, including the need to:

• fill in gaps in program guidelines and policy documents to support service delivery
• examine the level and flexibility of financial support available to program participants and service providers
• simplify the approval process

Best practices related to program design and delivery included:

• having a rigorous screening and selection process of program participants
• having knowledgeable and experienced service providers and government staff
• having service providers who can offer loans to participants
• using specialists to deliver tailored training
• having regular follow-up with participants

Key considerations for Self-Employment program and policy development

The following considerations for program and policy development emerged as part of the study.

The Self-Employment program can benefit from an updated objective specifying that it is dedicated to eligible participants who have a viable business idea, the financial or in-kind resources to launch a business, and the required level of dedication.

The data collection process should include only participants who have been deemed suitable for self-employment and accepted into the program. This will require excluding candidates who attended information sessions alone or those deemed not suited for self-employment. The latter participants can be reported under EAS.

Indicators of program success can include: increase in employment and/or self-employment levels; medium-term increase in earnings; business survival rate similar to the local economy and/or the sector; and acquisition of transferable skills.

Nova Scotia may wish to consult with its service delivery network on the extent to which identified challenges are applicable to their unique context, and how best to address them along with integrating lessons learned that can benefit program delivery.

The following is a summary of guidelines in Nova Scotia for JCP in the years 2018 and 2019. Key informants did confirm and complement the information found in program guidelines.

Program objective

The JCP program in Nova Scotia is designed to support projects that will provide eligible participants with opportunities to gain work experience and to improve their employment prospects. While project activities should benefit both the participant and the community, the focus of JCP is to assist participants in acquiring work experience, leading to the acquisition of new employment-related skills or the improvement in current skills.

JCP is delivered through the provision of funds to an organization that implements a community-benefiting project while providing work experience to participants.

Participants receive benefits from EI Part I or II.^{Footnote 48} Benefits to participants follow the prevailing wage rate, up to the maximum EI weekly benefit rate. Participants may receive an additional wage top up from the sponsor/employer.

Program delivery

The design and delivery of JCP allows Nova Scotia to address a variety of barriers to employment experienced by its residents (for example, lack of work experience). JCP is not generally used to address labour market issues experienced by economic sectors or local communities.

Program managers reported that the amount allocated to JCP is influenced by previous funding levels. They specified that flexibility exists to increase funding in order to meet labour market needs. There are indications that the use of JCP may decrease due to the removal of some eligible expenses and the introduction of the more generous START program.

In addition to gaining work experience, key informants identified a variety of other benefits that can be expected from JCP projects. Participants are expected to develop soft and work-related skills, and to enhance their job search abilities, career development and prospects, and personal well-being.

Sponsors can benefit from JCP through increased capacity by having access to labour, implementing their projects, and increasing their services to local communities. At the community level, JCP projects can support the local economy by providing new information and assets (for example, festivals, gardens, collecting and documenting sector-specific data) as well as improved services.

Challenges and lessons learned

Key informants identify challenges related to the recruitment of participants and organizations.

Key informants identify the following elements as contributing factors to participants’ success.

Recurring projects are a good practice. As well, projects with a 12-month duration can provide a credible work experience to participants.

In terms of monitoring, having regular contact with JCP participants, on-site monitoring and providing support to JCP sponsors are important considerations.

Participants who benefit the most from JCP are those in need of work experience and networking opportunities.

Well established not-for-profit organizations, that used JCP previously, are most likely to succeed as JCP sponsors. They have the capacity to manage funding and to provide support to participants.

Projects found to be best suited under JCP are those that are well defined, incremental to the work of the sponsor and focused on community development. Examples include projects associated with festivals or fundraising events.

Key considerations for JCP program and policy development

The following consideration emerged as part of the JCP study.

Compared to other Employment Benefits offered under the Canada-Nova Scotia LMDA, JCP is a less attractive program and is the least used. The program could benefit from increased promotion and changes to make it more attractive to organizations and job seekers.

On average, JCP accounted for approximately 1.5% of total LMDA expenditure between fiscal years 2012 to 2013 and 2017 to 2018. Awareness and interest in the program were a challenge, despite its positive outcomes. Key informants reported the lack of promotion to potential organizations and identified the lack of interest by organizations and job seekers as challenges. Recruitment of participants may be affected by the low level of financial support available to them compared to other programs.

The Sector Council Program aims to support an industry-led approach to human resource development tailored to meet the labour market needs of industry sectors. It includes a wide range of funded activities, such as:

• human resource planning including:
  • creation and dissemination of labour market information specific to an industry
  • consultation on labour market challenges and opportunities
  • development and implementation of human resource strategies/plans and tools
  • identification and dissemination of promising practices
  • identification of industry training needs
  • informing educational curriculum
• attraction and retention activities including:
  • creation and dissemination of career resources (for example, brochures, videos; virtual reality career exploration tool)
  • creation and dissemination of promotional material and messaging for the sector as a valid employment destination
  • participation in/hosting events to promote sector career opportunities (trade shows, career fairs, career presentations in schools)
  • promotion of the value of skills development
  • activities that support welcoming workplaces
• development of training curriculum and other learning resources

With $11.5 million in fiscal year 2019 to 2020, the Sector Council Program represents nearly 11% of total expenditure under the Canada-Nova Scotia Labour Market Development Agreement. In 2020 to 2021, Nova Scotia spent approximately $5.5 million on the Sector Council Program, which represented about 6% of Nova Scotia’s total LMDA funding.

Funded organizations

Funded organizations include non-profits sector councils.

Targeted labour market issues

Sector Council Program projects target skills and/or labour shortages. These projects also target specific unemployed populations (for example, women and youth).

Generally, funded projects target labour market issues associated with:

• lack of capacity for human resource planning resulting in attraction and retention challenges for sectors
• shortages of sector specific labour market information
• technology changes
• demographical changes (for example, aging population and rural out migration)
• skills development challenges/training gaps to fill in-demand jobs
• seasonal nature of employment

All projects reviewed align with Sector Council Program objectives and eligible activities.

Partnerships

The Department of Labour and Advanced Education and all key informants confirm that program officials carry out activities to support the formation and maintenance of partnerships as a part of the program design and delivery.

According to the Department, partner’s contributions are beneficial, but not required for the achievement of the project expected outcomes. All key informants stress the importance of partnerships for projects’ success explaining that partnerships increase the reach and impact of the program, allow project holders to learn about sector needs and contribute to the project delivery.

Through questionnaire, document review and key informants it was found that:

• partnerships are established to support the delivery of all projects
• partners make a financial and/or in-kind contribution. The most common forms of in-kind contribution are office/event space and usage of equipment
• project activities delivered with the support of partners include:
  • consultation on labour market challenges and opportunities
  • human resource plan development
  • human resource tools development
  • career awareness tools and material development
  • career awareness events
  • labour market and human resource research and training development

Challenges and lessons learned

The Department of Labour and Advanced Education and program officials identified challenges related to program administration and monitoring, such as staff turnover.

Actions of program officials and project characteristics that were identified as being conducive to the success of the program include:

• project holders being well established organisations, knowledgeable of the sector and having the capacity to deliver the project
• projects grounded in industry needs and/or having good labour market data for evidence-based decisions
• ongoing communication and trusted relationship between project holders and program officials
• program officials working with sector councils to increase their knowledge, expertise in strategic workforce planning, capacity and the provision of strategic guidance leveraging the strengths of other partners
• providing with opportunities and supporting capacity development to build the partnerships as partners enable the project success
• being nimble and knowing when to make slight adjustments in the project to meet overall objectives

Key considerations for the Sector Council Program

The following considerations for program and policy development emerged as part of this study.

Considering that the current performance indicators do not reflect the diversity of activities funded under Sector Council, it is important for ESDC and Nova Scotia to discuss current funded activities in order to make recommendations on how best to report on results.

It is essential to share lessons learned about successful Sector Council Program projects. Particularly, for projects targeted to employers (such as workplace or employer-sponsored training), and those assisting communities and economic sectors dealing with labour market adjustment issues (contraction or expansion).

Research and Innovation projects aim to identify better ways of helping participants prepare for, return to, or keep employment and to be productive in the labour force. Activities funded under Research and Innovation are designed to further develop existing programming or to develop new programming that will either compliment or replace existing programming. 

Nova Scotia uses Research and Innovation funding annually. During the period of fiscal years 2016 to 2017 and 2019 to 2020, funding ranges from less than 1% ($267,000) to 4% ($3,822,000) of the province’s annual LMDA funding.

Funded organizations

Funded organizations include not-for-profit organizations, educational institutions and intergovernmental bodies.

Funded Research and Innovation activities

Research and Innovation projects encompassed a variety of activities including:

• conducting a survey of skills in literacy, numeracy and problem solving in technology rich environments among adults between ages of 16 to 65 in Nova Scotia
• developing a centre for digital learning to provide best practices and supports for post-secondary institutions offering online education
• using the Phoenix Employment Program designed to provide under-supported unemployed or under-employed youth (aged 18 to 29) with an innovative approach to addressing unique barriers to employment

Innovation definition and criteria

When assessing an activity for eligibility for Research and Innovation, achieving the desired outcomes and increased efficiency are the 2 highest weighted factors.

Performance measurement

Agreement holders are required to submit both activity and financial reports either throughout the project or prior to completion of the project.

Challenges and lessons learned

Project documents and program officials identified challenges related to testing and identification of innovative approaches including:

• short timelines for projects
• project staff inability to coordinate with employers
• challenges experienced by project participants such as mental health issues

In relation to factors contributing to successful testing and identification of innovative approaches, program officials highlighted the importance of:

• employing experienced staff who have experience in previously administering the program
• providing additional support to participants for issues outside of the program scope such as benefits, housing, childcare and literacy
• integrating databases to provide program officials with an environment to collaborate, discuss and disseminate ideas
• conducting monthly check-ins with employers
• providing flexibility to wage subsidies
• employers attending education and training sessions

Top 3 occupation groups for participants in SD-Apprentices

Active claimants:

• skilled crafts and trades workers = 85%
• other manual workers = 5%
• skilled sales and service personnel = 3%

Former claimants:

• skilled crafts and trades workers = 76%
• other manual workers = 8%
• skilled sales and service personnel = 4%

Top 3 industries for participants in SD-Apprentices

Active claimants:

• construction = 51%
• manufacturing = 16%
• retail trade = 9%

Former claimants:

• construction = 43%
• manufacturing = 14%
• retail trade = 10%

Labour market outcomes

The labour market outcomes are based on individuals who began their participation during the 2010 to 2012 period. Statistics focus on 5 years before program participation and 5 years after the program start year.

Active claimants

As shown in Chart 10, program participants increase their average earnings from $17,445 in the fifth year pre-program to $52,140 in the fifth year after the program start year.

Text description - Chart 10

Year in pre-post participation period	Employment earnings
5 years pre-program	$17,445
4 years pre-program	$19,926
3 years pre-program	$21,362
2 years pre-program	$24,918
1 year pre-program	$29,536
Program start year	$29,775
1 year post-program	$42,059
2 years post-program	$49,391
3 years post-program	$52,397
4 years post-program	$52,228
5 years post-program	$52,140

The proportion of employed participants declines slightly after the program start year but remains around 96% for the annual post-program average. The proportion of participants on EI Part I decreases from 100% in the program start year to 40% in the fifth year after the program start year. Participants decrease their dependence on income support from 29% in the program start year to 8% in the fifth year after participation.

Former claimants

As shown in Chart 11, program participants increase their average earnings from $17,851 in the fifth year pre-program to $55,907 in the fifth year after the program start year.

Text description - Chart 11

Year in pre-post participation period	Employment earnings
5 years pre-program	$17,851
4 years pre-program	$21,422
3 years pre-program	$24,163
2 years pre-program	$27,257
1 year pre-program	$30,693
Program start year	$38,470
1 year post-program	$46,484
2 years post-program	$52,486
3 years post-program	$54,833
4 years post-program	$54,525
5 years post-program	$55,907

The proportion of employed participants declines by 1 percentage point annually after the program start year but remains around 96%. The proportion of participants on EI Part I decreases from 77% in the program start year to 29% in the fifth year after the program start year. Participants decrease their dependence on income support from 12% in the program start year to 6% in the fifth year after participation.