Canada’s employment insurance system requires modernization to withstand future economic challenges and to ensure Canadians’ financial security, according to a new report by the Institute for Research on Public Policy.

The proportion of unemployed Canadians eligible for EI has decreased from 80 per cent in the 1980s to 40 per cent today, it said, noting many employees who do receive EI benefits struggle to make ends meet.

Read: EI system needs redesign amid threat of recession: report

The report proposed three EI modernization measures, including expanding and increasing coverage, while keeping premiums paid by employees and employers low and stable and maintaining EI as a self-financing program. It estimated the costs of implementing these proposals at between $5 billion and $15 billion per year.

In light of those costs, the IRPP, in a separate report, proposed a series of reforms that could begin in 2023, including a shift to a standard EI eligibility requirement of 420 hours, as well as increasing the rate of salary replacement from 55 per cent to 60 per cent.

It also called for EI eligibility for employees who quit to pursue training or education, as well as the implementation of a minimum weekly benefit for gig workers, to incentivize them against declaring unemployment.

Read: Union calling on government to renew pandemic EI measures