HRSD Medium-Term Policy Research Priorities
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1 Human Resources and Social Development Ressources humaines et Développement social HRSD Medium-Term Policy Research Priorities Prepared for: Annual Symposium of the Population, Work and Family Policy Research Collaboration (PWFC) Château Laurier Ottawa, Ontario March 23-24, 2006
2 1 What are the contextual factors at the community level that significantly affect life course events and transitions? How do they affect those events and transitions? In what ways can/should we support communities in developing and sustaining mechanisms to help people adjust to critical life course events and transitions? Life course events and transitions such as changing jobs, having children, pursuing further education, retiring and changing residence are affected by prevailing demographic, social and economic conditions at the community level. Residents living in communities that lack one or more types of capital (economic, social, human, physical) may experience adjustment problems. The presence of well-functioning social networks at the community level can support individuals and families at critical periods in their lives. There is a mutually reinforcing relationship between individual and community wellbeing. The greater the resources that individuals and families possess or have access to, the more likely they will be able to successfully surmount challenges they face over the life course and contribute to the well-being of their communities. How do individuals and communities interact? What is a well-functioning community and what are its characteristics? What are the key differences in pressures and realities facing different types of communities (e.g., rural, urban and Northern)? What roles do community organizations and networks play in supporting individuals and families during critical transition periods? Is government intervention necessary to assist communities? How should governments best support communities?
3 2 What characterizes a labour market that encourages social and economic inclusion? What characterizes one that leads to exclusion? For most Canadians, the opportunity to fully and actively participate in Canadian society, both economically and socially, requires having access to employment that will provide a sufficient and dependable source of income to meet needs over the life course. Employment can also provide an opportunity to participate in the non-economic aspects of life, and provide a sense of self-worth and of belonging to the wider community. Paid work can provide one pathway out of economic and social exclusion, but poorly-paid work is not a solution for alleviating poverty. Certain groups at risk, such as recent immigrants, lone parents, persons with disabilities, Aboriginal people and those experiencing persistent poverty, may face barriers or limits to labour force participation and advancement, or may experience severe pressures in balancing work and home life. What are the key characteristics of an inclusive labour market? What barriers limit labour market participation? What are the key characteristics of the working poor, and what distinguishes working poverty from welfare poverty? How are family dynamics related to the financial vulnerability of Canadians? What do we know about gender gaps/ disparities in the labour market (e.g., related to wages, career opportunities, and the proportion of men/ women engaged in full-time versus part-time work)? What are the childcare needs of workers and to what extent are they being met? How should society value and recognize unpaid work?
4 3 What is the role of public policy in encouraging participation over the life course? A key goal of public policy is to enhance opportunities and remove barriers to inclusion and participation. This requires that Canadians have knowledge of, access to, and the ability to benefit from these opportunities. What types of policies would be most effective in encouraging participation? Does intervention early in life engender increased participation over the entire life course? What is the importance of a life course perspective in developing policies to encourage participation?
5 4 How does one increase the capacity of people with disabilities to be included and to participate in all aspects of Canadian society? At the heart of Canada s core social values is full inclusion social citizenship and equality of opportunity to participate fully in society. A key goal of public policy is to enhance opportunities and remove barriers to inclusion and participation faced by people with disabilities. Persons with disabilities have a productive capacity that is increasing as technologies and attitudes evolve. Their less than full inclusion has potentially significant costs to society. How is the principle of full inclusion for people with disabilities reflected in government policies and programs? How do existing indicators of inclusion and participation measure progress and assess policy effectiveness for people with disabilities? What barriers persist among people with disabilities, particularly during periods of significant transition such as moving between school and the labour market? What policies and programs have been successful in helping people with disabilities overcome barriers to inclusion? What are the costs associated with less than full inclusion of persons with disabilities in society? To what extent do different components of the disability income system (earnings replacement and income support from public and private programs) contribute to financial security for persons with disabilities? Is there adequate coverage for different groups of persons with disabilities and for different circumstances that persons with disabilities experience (e.g., episodic conditions and moderate severity)? What does the life course perspective offer in terms of analyzing the impacts of, and changes to, the disability income system? Does prevention/ early intervention when people are starting to develop disabilities result in longer labour force attachment and reduced usage of the disability income system?
6 5 What are the implications for individuals, families and society of changing family structures and composition? Compared to several decades ago, Canadian families today are typically smaller and have lower fertility, couples are older when they enter unions and bear children, and families experience higher levels of non-marital cohabitation and divorce. The result is more diversity in the family structures in which children reside and family members interact, and the circumstances and trajectories that families experience over the life course. Some individuals or families might require greater, or more timely, support to adjust successfully to these new realities. How are family structures and composition continuing to change? What are the implications of these changes for different family members (e.g., children, caregivers, lone parents, and non-resident family members including parents)? What are the roles and experiences of fathers in families? How does the composition, and do the dynamics and experiences of certain family groups (e.g., immigrant, Aboriginal and seniors families and families with persons with disabilities) compare to those of other Canadian family groups? What are the key differences? What are the key differences in family experiences and circumstances across regions, and between rural and urban settings? What are the factors affecting family formation and dissolution, and the apparent discrepancy between desired and actual fertility rates? What do we know about intergenerational transfers of resources within families? How do family transitions affect the functioning and well-being of family members? Should communities, employers and governments support families? What would be the best approaches?
7 6 What are the consequences of work-life imbalance for employees, families, employers and society? Labour force changes in recent decades, particularly the increasing participation of women and stagnant wage growth, combined with increasing diversity in family structures and composition have fundamentally altered the ability of families and employers to balance work-life obligations. Time-related stress and its causes can adversely affect societal well-being, and improving work-life balance may be difficult for individuals in particular situations (e.g., lone parents and caregivers). Population ageing may also exert increased pressure on work-life balance in the future. The share of the Canadian population reporting severe time-related stress varies according to gender and age. Females are more likely to report time crunch than males; its incidence increases for both men and women up to their mid-30s and then decreases. On average, almost one-quarter of employed individuals report experiencing time crunch. What are the main causes of work-life imbalance, to what extent does it exist, and what are its consequences? How will increased family diversification and population ageing affect work-life balance? How do particular forms of employment and work arrangements affect work-life balance? How does work-life imbalance affect child development? How are caregiving needs and supports changing? What strategies are effective in managing work-life obligations? What are the relative responsibilities of employees, families, employers, communities and governments in addressing work-life issues? Are existing sources of data adequate for assessing these issues?
8 7 What are the key factors affecting early childhood development, and how do outcomes in middle childhood and adolescence build on developments in earlier years? All children deserve a good start in life; to be healthy, safe, and ready to learn. Research studies have shown that the first years of life are very important for the development and well-being of children because it is at this time that they begin to acquire abilities and skills that will influence learning, behaviour and identity, and health throughout their lives. As well, parents have a major impact on the development of their children through their role as primary educator, and by their choices and behaviours. So too do caregivers, peers, community, and schools as children age. A strong foundation can bring lasting benefits in helping children meet challenges, participate in society, and enhance their quality of life as they grow and mature. They can also have positive future implications for society associated with the economic participation of these children, and to their contributions to social and civic life. Unfortunately, significant numbers of children and youth will experience developmental difficulties, some of which may have long-lasting effects that are not easily overcome in later life. What are the short-term and longer-term effects of early, good-quality interventions for promoting children s development? How do developmental outcomes vary over time by gender and age cohort, and for groups at risk (e.g., Aboriginal children, children living in official language minority communities, children with special needs, and children of recent immigrants)? How have parenting styles and factors affecting parenting been changing over time, and how do they affect children and the family as a supportive and nurturing institution? How do some children who experience difficulties overcome them and what are the key factors that promote resilience? What are the key factors affecting middle childhood and adolescence? How should disadvantaged children best be supported? What are the key characteristics of children s interactions in middle childhood with significant adults, and what are the impacts in terms of future educational and labour market outcomes? Are existing sources of data adequate for assessing these issues?
9 8 What are the benefits of introducing a life-course perspective into public policy? How should this be done? The life-course perspective is increasingly being viewed by academics and policy makers in many countries as a tool to inform and improve economic and social policies and programs. Individuals encounter many events and transitions over the course of their lives. The life-course perspective provides a way of understanding this information that can allow policies and programs to be developed to respond, not strictly to a particular circumstance at a particular point in time, but to a broader variety of circumstances, including linked lives, that influence a person s entire life. What are the strengths and weaknesses of different life-course perspectives? What do they imply for policy and program formulation? To what extent do Canadian policies and programs reflect the life-course perspective? What instruments do we need to support a life-course approach to policy-relevant research?
10 9 How is the retirement income system changing? What are the implications for current and future retirees? Questions are being raised about recent changes in the coverage, funding and benefits of private pension plans. These changes may have significant implications for the retirement decisions and incomes of both current and future retirees, and may increase the relative importance of the public (Canada/Quebec Pension Plan, Old Age Security and Guaranteed Income Supplement) and private savings (registered retirement savings plans and other individual savings vehicles) components of the retirement income system. To what extent do the different components of the retirement income system (public, private and individual including registered retirement savings plans) contribute to financial security (or adequate and stable income) in retirement? How has this been changing for different groups of seniors, for different generations, and for different regions? To what extent are private pensions changing and what are the implications of these changes (e.g., in terms of working lives and savings behaviour)? What influences the retirement savings behaviour of individuals? How do the various components of the public pension system affect retirement decisions? What does the life-course perspective offer in terms of analyzing changes that are taking place in the retirement income system?
11 10 How is the transition to retirement changing? What are its implications for individual and societal well-being? The transition to retirement is a major transition in an individual s life course. Choices made by individuals over when and how to retire have important impacts on their overall well-being and their financial health. One approach for improving the well-being of older Canadians is to reduce existing disincentives to work and expand choices in the transition to retirement. The number of retirees will increase substantially in the coming decades as the babyboom generation enters its retirement years. Needs and preferences will also likely change. These changes will lead to a greater public focus on the transition to retirement, and how it is changing. How is retirement defined? How are our notions of it changing? Why has the average age of retirement been increasing since the mid-1990s? What are the various pathways that people take to retirement? How will the transition to retirement be changed by the baby-boom generation? What are the main barriers limiting choice in the transition to retirement? What policies can improve choice in the transition to retirement? How would increased choice in the transition to retirement affect well-being?
12 11 How can better functioning labour markets improve productivity and standards of living? The importance of productivity growth and its cumulative impact on living standards is widely accepted. The benefits of greater participation in the workforce by moving people from the unemployed or under-employed to the ranks of the fully employed are equally obvious. So is ensuring that older workers are given the incentives and opportunities to extend their careers should they so wish. These matter especially now as we are heading toward a period of slower and slower growth in the potential labour force. At the same time we have been losing ground against the U.S. in both productivity growth and levels and standards of living measured in monetary terms, to an extent that could even impede our ability to attract mobile, high-quality labour. Why have real earnings of labour not increased more after years of economic expansion, not just in Canada but throughout the Western world, and what role might the rise of giant labour-plentiful economies like China, India and Brazil be playing in this? How will the rise of and integration of China, India and Brazil impact on relative supply and demand and remuneration for various skill types and even industries in the Western world? Are higher real wages needed to cause higher labour productivity (factor substitution) on the part of firms or is higher labour productivity needed to cause higher real wages? What is the extent of labour and skills imbalances and what are their effects on labour markets and productivity levels? What market forces help or hinder individual and market-wide skill adjustments? To what extent would higher human capital levels increase labour productivity? What is the speed at which labour market participants read and react to market signals? What skills do older workers need to be able to remain in the labour force as they age? How do private pension issues act as both an incentive (pension inadequacy) and disincentive (early retirement incentives in pensions) to work? What factors have driven employers and employees to devise private pension plans that reward early retirement and can/should these incentives change? How could employer/employee practices, such as hours of work, be changed to encourage greater participation of older workers? Does lack of employer-based benefit portability constitute a barrier to labour mobility, not just geographically but inter-firm?
13 12 Does Canada have enough mechanisms for labour market adjustment, to match the expected requirement for adjustment with an adequate capacity to adjust? Canada is generally seen as having a labour market that, by the standards of other countries, adjusts well to shocks and changes. Yet, Canada is again facing a considerable economic shock as the combined effects of the rise of China and India, the rise in commodity prices (especially energy) and the rise in the Canadian dollar are stimulating strong growth in demand in the West and the energy sectors while jobs are being lost at a rapid rate in the manufacturing sector. This is posing considerable adjustment problems and pressures, as it is resulting in jobs without people and people without jobs. If Canada can do even better at facilitating such adjustment, it will raise standards of living. : How can we measure the extent of adjustment in an economy and a labour market, to know if we have enough? To what extent are labour markets less exposed to changes in trade flows as more and more jobs are in the services sector? What is the current and the potential level of labour mobility? How does geography impact labour mobility? What role do housing asset prices play in reducing geographic mobility? What other conditions affect worker mobility, especially among older workers? To what extent are changes in relative wages the key impetus to moving labour from areas of excess supply to areas of excess demand? Can higher wages entice enough mobility to meet the labour needs of the energy sector? What will higher real wages do to firms that, unlike energy, cannot easily pay them? Do people tend to flow towards available work or do jobs tend to flow towards available workers? To what extent is policy a barrier to both? What factors explain an apparent reticence of young Canadians to enter the trades professions?
14 13 What are the factors which establish community resilience in the face of local economic shock and what is the appropriate government role in supporting community adjustment? Canada is increasingly urbanized and many Canadians are in large, diverse labour markets. Yet, many Canadians still live in small communities and less diverse labour markets. Economic prospects for individual communities and their residents will continue to vary: some still worry about having enough jobs for their people while others now worry about having enough people for their jobs. Given national demographics, most smaller communities will be facing declining populations. In many cases, individual communities, or even neighbourhoods, have not fared well, experiencing a decline in living standards for those left behind. In other cases, communities have supported adjustment, sustained standards of living, and prospered in the wake of economic shock. Adjustment may not be a matter simply of individuals moving from one location to the other. Those left behind may be put on a downward spiral as a result of loss of community-critical mass. Infrastructure concerns are especially important in both the losing and receiving locations. It is critical that we better understand the factors affecting community adjustment, and effective strategies for helping communities and individuals adjust. To what extent are Canadian communities vulnerable to such adjustment pressures? What are the likely demographic prospects for smaller communities not adjacent to larger metropolitan areas? What is the impact of the closure of a large employer in a smaller community? How does the closure impact individual workers and their families? What role can the federal government play in supporting individual and community adjustment in the face of economic shock? Workers who re-locate vs. those that remain in the community is there a difference in their labour market outcomes? To what extent does demographic decline impact on mobility via the value of owner-occupied housing? What strategies will allow governments to still efficiently offer public goods and services and infrastructure in the face of demographic decline?
15 14 How can we achieve better economic inclusion of immigrants, Aboriginal peoples, the homeless, and other vulnerable groups? The Canadian economy does not realize its full productive capacity when people do not participate in the labour market to the full extent of their abilities. Every resident deserves the opportunity to develop and contribute to society and the economy by participating in learning and the workplace. Despite the general expansion of the economy over the last decade, vulnerable groups such as immigrants and Aboriginal people have not experienced the same improvements in labour market and economic outcomes. Yet, the prospects for ongoing tightness in the labour market suggest there may be a window to do better than in the less propitious circumstances of the toofrequent past periods of high unemployment. What are the factors that affect the successful integration of vulnerable groups into the labour market? Will an ongoing tight labour market offer greater opportunities for those of lesser skills and, especially, formal education? Or, are those still excluded in a strong labour market increasingly those with serious skills or other disadvantages and in need of in-depth support? Should policy interventions be targeted on groups more likely to be excluded or on individuals, regardless of group membership, that are excluded? Do the poor labour market outcomes of immigrants result from some type of market failure or does the explanation lie elsewhere? Despite rising educational attainment of recent immigrants, why are their literacy and numeracy outcomes lower compared to the Canadian born population? Why are aboriginals experiencing such poor literacy and numeracy results? Are there learnable skills above and beyond the traditional products of educational institutions that can help the less advantaged become more fully integrated into the labour market? What failure in our social programs results in individuals falling through the social safety net so far as to become homeless? What policies and/or programs will help to reduce the barriers to obtaining housing? To what extent is adequate housing a successful trigger for beginning a re-integration into modern society for the homeless? How do we address the lack of data concerning Aboriginal people, and what steps should be taken to develop the data needed for research? What are effective policies and programs for increasing inclusion and to what extent is longer-term and more concerted support required for those still excluded?
16 15 How can we encourage lifelong learning and what are the repercussions of failure? Canada s comparatively high level of effort educational effort and high level of measured competency show we have done well on human capital formation. We may need to do better still. First, labour supply growth will slow as the population ages and the relative size of entry cohorts begins to fall. Second, human capital growth per capita will slow, since the education gap between new entrants and existing labour force participants is less than it used to be. Canada must also be sure that its large investment in educational systems is highly effective, in terms of efficiently getting good learning outcomes, and that the effort teaches what needs to be learned in the economy of today. That being said, the benefits of skills development are not limited to the workplace: skills can also be used to promote active citizenship and social inclusion. Lifelong learning is conceptually different from a traditional life course model of discrete stages of life of first learning, then working, then retiring. It means alternating between working and learning, or even combining them at any point in time. It means learning in many settings. It means learning by different means, as the clientele becomes more diverse in ethnic and/or socio-economic background and stage of life. It means an educational system that is responsive to those new needs, one that can meet the needs of those who must retune their skills, because their educational pathway turned out to not match changing demand for skills, or because their skills have become obsolete, or because they immigrated to Canada with gaps in their skill set. What broad skills are needed to function effectively throughout the lifecycle? Does human capital deteriorate more rapidly in a faster-paced world? What are the barriers to adult training and education? What are the enablers (ie career development information)? What is the most appropriate skill metric earned credential, skills acquired, competencies? How do adults learn and what are the settings in which this learning is most likely to occur? What are the skill outcomes of non-traditional learning? What are the returns, both monetary and non-monetary, to learning new skills? What are best practices in the maintenance of human capital and skills? Is the education system as efficient as it could be at imparting human capital to students? Have recent declines in educational expenditures per student been at the expense of the quality of the learning experience? What is the role of the workplace in skill gain or skill loss of workers? What role does credentialism play in the labour market? Do we have too much (that is inappropriately used as a screening tool) or too little (meaning information failures)? Is Canada investing enough in highly qualified personnel to be competitive in a global economy? Can an increased supply of more highly-qualified workers create its own demand, especially in a smaller economy next to a larger one with excess demand?
17 16 What are the ways in which learning outcomes and returns can be measured? Currently, the way we collect information on learning is mainly through capturing exposure to learning, including education and training activities. However, exposure does not simply translate into learning. Nor does learning translate into earning. Data on earnings also shows considerably more divergence in earnings within given levels and subjects of formal educational attainment than between levels and subjects, suggesting that other factors play a huge role in earnings. Data on earnings also show that those with higher levels of initial educational attainment earn more and see their earnings rise more with work experience. This suggests an important need to complete a human capital measurement system, to discover the connections or lack thereof from educational effort, through learning outcomes, through labour market and life satisfaction outcomes. This is also important for understanding the payoff from that educational effort. Considerable work has been undertaken to measure the returns to human capital. That being said, there is no consensus on the best measure, no standard methodologies for understanding net returns, for distinguishing between social and economic returns, or for incorporating both private and public returns to different levels of human capital development. As a consequence, little is known about the relative returns on the various types of learning both formal and informal in employment and social outcomes. Better direct measures are also needed of skill levels. Although much progress has been made in the measurement of literacy and other basic skills, a more complete set of direct skill measures may be required. What are the good proxies of human capital educational attainment versus directly measured skills versus economic outcomes? What are the various methodological and data challenges in appropriately measuring economic and social returns to human capital development? What is the best way to measure outcomes of learning through the life course? What is the optimal methodology to estimate economic and social returns to adult learning? Is the data currently available? What is the integrity of existing data? Are there broad social indicators of quality of life and well-being that are the product of educational effort? What skills should we directly measure? How should we measure them? Can more of the skills that employers are looking for be directly measured and become the basis for more comprehensive credentials systems? Can more complete credentials systems improve employer information about potential employees and aid labour market matching? How can we collectively work with employers to better understand learning approaches, expenditures and outcomes?
18 17 Is our income support system well structured to meet the challenges of both diminishing the apparently growing gaps in earned incomes and providing the help up and incentives for those of low income to improve their labour market and earnings outcomes? Canada s governments have many policy and program levers that can have important impacts on the income security and employment prospects of Canadians. Yet, despite some recent innovations such as refundable tax credits, the system is largely based on designs from decades ago. We have had successes and failures. On the one hand we have dramatically reduced poverty amongst the elderly. On the other hand we have been unable to attain such a poverty reduction for those of working age, perhaps because income security for the elderly need not be much concerned with inadvertently creating work disincentives. In particular, the system is designed largely in a static sense, in that we try to manage the support-incentive trade-offs at a point in time or within a single year. It may well be that building an income distribution system more oriented towards the life cycle of individuals may find a better mix of good income and good incentive outcomes. Canada s employment insurance program is one element of this income security system. It was developed in the post-war era, and was intended to function as an insurance system. Over the past few decades, Canadian society has changed profoundly along many dimensions. For example, the population level, mix and age distribution, the educational level, the size and structure of the economy, the labour market, the requirements for and of work, the work and family balance, and the urban nature of Canadian society have all changed. In this context, the employment insurance program has also changed in terms of its clients, the forms of and extent of income benefits provided, and its emphasis on active employment measures. But, could it too provide better support and incentives if it was more explicitly cognizant of the life cycle? What is the current portrait of who uses and how people access all forms of income support? What are current, government approaches to provision of income support? Are current approaches to income security appropriate to the realities of today s labour market? Is there a regional dimension? What critical trends and/or changes are taking place that might impact the structure of the current mix of programs? How much support is sufficient? Could more intensive support for skills upgrading help recipients transition to better labour market and earnings outcomes? Can asset-based approaches to income support achieve better trade-offs between levels of support and the disincentives support so often creates? Does income support during times of temporary unemployment result in better long-term labour market matches? Does this lead to a more productive workforce?
19 18 Could active employment measures have significant positive returns in terms of improved labour market and earnings and life satisfaction outcomes for beneficiaries? Why is this important? Active Employment Measures are designed and delivered to enable participants to find and retain productive employment. Services offered can include skills training, employment counseling, wage subsidies, or services which support either employment or training participation (i.e. child care services, transportation support, mobility assistance). Active employment measures are generally available to unemployed individuals, although increasingly there is recognition that vulnerable workers in paid employment often need support to either retain their current position or to find secure employment elsewhere. A review of international and Canadian evaluations of the outcomes of active employment measures suggest outcomes ranging from clear failure to fairly satisfactory levels of success. Failures could be due to insufficient depth of interventions, in terms of length or intensity, or insufficient breadth, in terms of lack of coordination of interventions. Findings consistently suggest that successful strategies require adequate resources and a multipronged approach to surmount individual employment barriers to the extent needed for the client to transition to a different life course. For many client problems, there is no satisfactory one size fits all approach, pointing to the importance of targeting and tailoring, taking individual needs and preferences into account. Indeed, it may even prove cost effective to intervene at earlier stages for those at risk, rather than waiting until risks such as long-term unemployment have been realized. Although intensive program approaches can be costly, they may also be more cost-effective in the longer run. What role do active employment measures play in getting individuals back into active employment? How do we determine an effective level of support? Do active employment measures affect long term employment outcomes? What are reasonable expectations of short term active interventions? How much and what kind of employment information and support is sufficient? What is the balance between active and passive measures? What is the balance between private and public support? What are employers currently doing to assist unemployed workers? How appropriate is targeted programming? What about universal programming? To what extent can programming identify those at risk of bad outcomes and to what extent is earlier intervention easier and more cost effective? What other institutional supports are available to workers? How effective are they? Should the emphasis be on a work-first approach? What happens when workers participate in more than one program at a time? What is the optimal timing for intervention?
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