Finance Minister Jim Flaherty Friday defended his government’s proposals to change employment insurance, saying the aim is to remove "disincentives to employment."

Speaking to reporters in Oshawa, he said the changes are a "very sensitive subject in some parts of the country," and that the views expressed by Canadians "will be taken into consideration" by the government.

Human Resources Minister Diane Finley Thursday unveiled reforms that would change the definitions of "suitable work" and "a reasonable job search" in order to qualify for benefits.

The changes include measures that require that the longer and more frequently someone is claiming EI, the broader their job search will have to be and the lower the wages they must be willing to accept.

Flaherty's tone was more subdued than that on May 15, when the Opposition criticized his comments that there are no bad jobs.

"There is no bad job, the only bad job is not having a job," he told reporters then. 

Flaherty criticizes European leaders

Flaherty also repeated his view that European leaders are failing to react to the region's debt crisis decisively.

"We've been firmly of the view that the European authorities need to act in an overwhelming way to get ahead of this problem with sovereign indebtedness and undercapitalization of some of the European banks," he said.

"And so far, they've been acting in an incremental way, which has not been successful."

Because Europe accounts for only about 10 per cent of Canada's merchandise trade, there are few direct effects from an escalating European crisis that could undermine the Canadian economy, but Flaherty said we could be affected by a banking crisis.

"The danger for Canada is really a disruption in the credit markets, a tightening of credit because banks become afraid to lend to each other."

"We saw this in 2007 — 2008," he said.

"We have steps we can take to deal with it, similar steps to what we took in 2007 — 2008 in Canada."

"As you know, we came through the credit crisis relatively well, but it does shock the economy."