How Does Federalism Condition the Employment-Welfare Relationship?: Integrating Social Welfare Policy and Active Labor Market Policy into Youth Employment Policy in Canada

Abstract

To account for the formation of employment-welfare relationship, conventional studies often rely on the demand-side or the supply-side perspective. To explain the complete mechanism in the observed nexus, however, I argue that a political institution and its historical path need to be investigated. By examining youth employment policy in Canada, this paper explores how the strategy of integrating social welfare policy with active labor market policy targeting youth ended up with potentials for unilateral action, both at the federal and provincial levels, how the subsequent centralizing force undermined the devolution efforts and the ensuing reform in accordance with neo-liberal framework in labor market policy, how political institutions in a federal state came to affect the phase of employment-welfare relationship, and ultimately why such a center-governed active labor market policy often falls short of realizing its intended objective of transforming the existing nexus between welfare state and production regime.