For a government that has made jobs and growth its mantra, the current economic landscape is an awkward reality for the federal Conservatives.

The economy is barely growing and unemployment is stuck stubbornly above pre-recession levels – 7.1 per cent in August versus 6.1 per cent five years earlier.

Enter Finance Minister Jim Flaherty with the surprise announcement last week that he's freezing employment insurance rates – not just for 2014, but for 2015 and 2016 as well.

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The move will leave roughly $3-billion over three years in the hands of employers and employees – relief from an erstwhile tax hike.

"This is the government saying, 'here's our new jobs strategy,'" said Peter Devries, a former director of fiscal policy with the Finance Department. "What else can they do? This is very public and it's something that many people see as a job killer."

It's also a tacit acknowledgment by Ottawa that its economic tool box is empty.

The slogan "jobs and growth" has been on the cover of every federal budget, dating back to 2010. But it doesn't have much to show of late for all the work it's doing on austerity, free trade, pipelines and innovation.

Deficit reduction, for example, wins kudos in financial markets. But in the absence of jobs and growth, balancing the books by 2015-16 isn't likely to be a seductive campaign slogan in the next election. As Mr. Devries points out, eliminating the deficit alone won't be enough to demonstrate good stewardship of the economy in 2015.

Likewise, aggressive promotion of free trade is proving to be more long-term project than quick fix. A free-trade deal with Europe has been stalled for months and the ambitious Trans-Pacific Partnership remains a long way from fruition. Other trade deals may be even further away.

The government's push to secure better access to markets for western crude is also slow moving. There is no guarantee that the Obama administration will approve TransCanada Corp.'s Keystone XL project, which would ship Alberta oil to refineries on the Gulf of Mexico. A host of other domestic pipeline proposals face steep economic and political hurdles.

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And finally, for all the fuss about innovation by this government, Canada continues to be a poor performer on such key metrics as productivity and business spending on research and development. The World Economic Forum recently ranked Canada 14th in global competitiveness, not good for a country that was once a consistent Top 10 performer.

Given all that, the EI premium freeze is a convenient talking point – a surrogate for other economic policies. The government can claim that it's doing something to foster job creation or, at a minimum, that it's not doing anything to impede jobs.

Mr. Flaherty said the change will leave money "in the pockets of job creators and Canadian workers," and help small businesses grow.

But, really, Ottawa had no choice. Raising EI rates now would have left it open to accusations from business groups that it's getting a windfall in premiums it doesn't need.

The government's just-released EI actuarial report shows that the EI operating account's deficit is shrinking much faster than anyone expected as EI claims drop. Chief actuary Michel Millette said the cumulative deficit would fall to less than $2-billion by the end of next year. Just a few months ago, the budget had predicted a $4.5-billion deficit.

In 2014, EI premiums will bring $23.5-billion while benefit payouts would be just $19.6-billion, according to the actuary.

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If the trend continues, Ottawa could be in a position to cut EI premiums in 2015 and beyond.

Ottawa is apparently confident it will meet its target to eliminate the deficit in 2015-16. It does not need to pocket surplus EI premiums to get there faster.

The Conservatives have long promised that they intend to cut taxes once the budget is balanced.

The EI premium freeze is Mr. Flaherty's down payment on that promise – a prelude to the next phase of the government's jobs and growth agenda.