I.Overall Stability in Employment Situation

Employment presents a great pressure on China due to its huge population, abundant labor resources and economic restructuring. The Chinese government regards increasing employment opportunities as a major strategic task in economic and social development, and controlling the rate of unemployment as a main target in macro-economic regulation and control. It has rationally readjusted the employment structure, established a market-oriented employment mechanism, put great efforts into increasing overall employment and maintained basic stability in the general employment situation. By the end of 2001, the country's population had reached 1.27627 billion (excluding the populations of the Hong Kong and Macao special administrative regions and Taiwan Province), and 730.25 million people were employed, accounting for 77.03 percent of the total labor force. Employees in urban areas accounted for 32.8 percent of the total, and those in rural areas for 67.2 percent. The unemployment rate on record in urban areas was 3.6 percent.

Implementing the Policy of Vigorously Increasing Employment

Focusing on economic construction, the Chinese government promotes employment through economic growth, carries out an active policy of employment, and adopts various effective measures to increase the rate of employment.

Rationally readjusting the employment structure. In line with the readjustment of the industrial structure, the government guides the development of industries and enterprises capable of offering more job opportunities. While increasing capital construction investment, vigorously expanding the domestic demand and maintaining the high-speed development of the national economy, the government stresses the development of labor-intensive enterprises with comparative advantages and market potential, especially service enterprises and small and medium-sized enterprises capable of offering employment to a large number of people, through readjustment of its industrial policies. It also increases employment and expands employment channels by vigorously developing the economy with diverse forms of ownership, such as collective, private and individual ownerships, and by encouraging various forms of employment.

Establishing a market-oriented employment mechanism. Carrying out the employment policy of "laborers finding employment on their own initiative, the market adjusting the demand for employment and the government promoting employment," the Chinese government encourages securing employment through fair competition, encourages employers to decide the number and quality of their own employees, and adopts measures to promote the shaping of a market-oriented employment mechanism. In the meantime, the labor market information network has started to display its worth, promoting exchanges of information concerning labor supply and demand, and helping the jobless find employment or reemployment through the labor market. In order to set up a labor market with a sound mechanism, standardized operation and good service, and under effective supervision, the Chinese government has conducted trials to set up a scientific, standardized and modernized labor market in 100 cities. In recent years, the Chinese government has started to trial-implement a pricing mechanism for the labor market, in order to enable the market mechanism to play its basic regulatory role in the allocation of labor resources, wage formation and labor flow.

Enhancing workers' quality. In order to raise the cultural level and professional skill of the work force, the Chinese government has striven to promote all forms of education through various channels, and laid equal stress on academic and vocational qualification credentials. At present, the system of nine-year compulsory education covers 85 percent of the total population, and the illiteracy rate among the young and middle-aged has dropped to 5 percent. There are currently 1,225 regular institutions of higher learning, with 7.19 million students; 686 adult institutions of higher learning, with 4.56 million students; and 80,400 regular middle schools, with 79.19 million students. China is aiming to establish an all-round, multi-level vocational and technical education and training system by developing higher vocational and technical schools, secondary vocational and technical schools, secondary polytechnic schools, technical schools, employment training centers, community-run vocational training institutions and enterprise-run on-the-job training centers, thereby strengthening the training of new workers, on-the-job employees and laid-off workers. Pre-job training courses of one to three years are offered to secondary-school graduates who have failed to gain higher education. Technical schools and employment training centers are being readjusted and restructured into comprehensive training bases. A mechanism by which "the market guides training, and training promotes employment" is being formed. The vocational qualification credentials system is being introduced, and a vocational qualification system has been set up covering workers at all levels, from basic workers to senior technicians. At present, in urban areas over 80 percent of newly employed people are graduates of senior high schools or above, or have received job skill training. Nearly 35 million people have obtained vocational qualification credentials.

Developing the employment service system. Since the 1980s, China has set up and improved the employment service system, which includes employment agencies, employment training, unemployment insurance and employment service enterprises. The system offers guidance, consultancy and agency services to job seekers and employers, offers pre-job training and vocational training courses to seekers of employment and reemployment, and provides unemployment insurance. The system also offers job openings to those of the weak group in the employment field. In the meantime, the government encourages the formation of community-run employment agencies as a part of the multi-level employment service network.

Making overall plans for urban and rural employment. China has a serious problem of insufficient employment opportunities in rural areas, where there are abundant labor resources. Attaching great importance to the employment of the rural labor force, the Chinese government has explored new ways for comprehensive employment planning in urban and rural areas in line with the urbanization and western development strategies. Two basic policies have been worked out. The first is to encourage the rural labor force to find work locally. Making full use of the advantages of local resources in rural areas, the government will vigorously readjust the structure of agriculture and that of the rural economy; develop profitable and labor-intensive agriculture alongside non-agricultural industries in rural areas; guide township enterprises to develop in line with the construction of small cities and towns; enlarge the construction scales of infrastructure facilities such as water conservancy, communications and transportation, and electricity in the rural areas; and promote elementary education and vocational training in the rural areas. The second is to guide the rural labor force to find employment in other areas. As success in rural reform has greatly raised agricultural productivity, the surplus agricultural labor force has started to flow from rural to urban areas, and from western inland to eastern coastal areas. The Chinese government guides the flow of rural labor to different areas according to need, and, by strengthening information network building and employment agency services, offers pre-transfer training to rural workers and organizes an orderly flow of the rural labor force, so as to ensure the highest possible level of employment in this regard. The government has also established an employment mechanism for the two-way flow of rural workers, whereby to help the latter to find jobs in other areas or return to their native places to start businesses. At present, 1,000 rural labor flow and employment monitoring stations have been set up in 100 counties and cities around the country to analyze the flow of and demand for workers from the countryside and regularly release information, so as to guide the rational flow of migrant rural labor force.

Enlarging Employment Scale, Optimizing Employment Structure

Through the common efforts of the government and all sectors of society, total employment in China has grown remarkably. Since 1978, the number of employees in urban and rural areas has increased by 328.73 million, of which 144.26 million are urban employees.

The employment structure, too, has changed dramatically. In 2000, employees in the primary, secondary and tertiary industries accounted for 50 percent, 22.5 percent and 27.5 percent, respectively. In recent years, the employment percentage of the primary industry has dropped markedly, while the employment percentages of the secondary and tertiary industries have risen rapidly. Particularly, the growth rate of the employment percentage of the tertiary industry has been higher than that of the secondary industry. The employees of state and collective enterprises and institutions accounted for 37.3 percent of the total urban employees in 2001, down from 99.8 percent in 1978. Meanwhile, the number of employees of private, individually owned and foreign-invested enterprises has increased drastically. In the countryside, the household is still the dominant unit of agricultural employment. However, with the implementation of the urbanization strategy and the development of non-agricultural industries, non-agricultural employment and the transfer of rural labor have increased rapidly. By the end of 2000, the number of employees of township enterprises had reached 128.195 million, of which 38.328 million were employed by township collective enterprises, 32.525 million by township private enterprises and 57.342 million by individually owned township enterprises. Since the 1990s, the labor force transferred from rural to urban areas has topped the 80-million mark.

Promoting Reemployment of the Laid-off and Unemployed

With the speeding up of the economic restructuring, the long-accumulated contradictions in the operating mechanism of enterprises have become increasingly apparent, and large numbers of redundant employees in enterprises have been laid off. Most of the laid-offs from state-owned enterprises are relatively older, poorly educated and skilled in few jobs. Therefore, it is rather difficult for them to find reemployment. To settle the problem of the laid-off and unemployed personnel, the Chinese government, while guaranteeing their basic livelihood, has formulated a whole slue of policies, complete with a variety of measures, to ease the way for their reemployment.

Adopting active employment service measures. Reemployment service centers have been established in all those state-owned enterprises that have laid-off workers and staff members. After they have registered with the centers, governmental public employment service organs will provide them once with occupational guidance, thrice with employment information and once with free job training, all on a six-month basis. Beginning in 1998, the government started to implement the first phase of the "ten million in three years" reemployment training program, which was aimed at training ten million laid-off jobless persons in the course of three years. By mobilizing all the training forces in society, employing the beneficiaries of training and other effective measures, the government has convinced laid-off and unemployed persons to participate in reemployment training. From 1998 to 2000, more than 13 million laid-off and unemployed persons nationwide had taken part in retraining, and the reemployment rate after six months of training had reached 60 percent. The government began to carry out the second phase of the reemployment training program in 2001. Moreover, a total of 30 cities so far have carried out a "starting a business" training program, offering training to laid-off and unemployed persons who wish to establish small businesses, helping them register with the industrial and commercial administration authorities and acquire small loans after the completion of training, thereby to increase their reemployment opportunities through the establishment of small businesses.

Improving and implementing preferential reemployment policies. By simplifying the procedures of registration with industrial and commercial administration authorities, arranging business premises, reducing or waiving taxes and fees, and granting loans, the government helps laid-off and unemployed people set up economic entities or labor organizations to support themselves, seek reemployment or otherwise to find their own means of livelihood. Taking employment in community services as the main orientation of the reemployment efforts, the government has spared no pains to develop those small enterprises and employment service enterprises that can provide more employment opportunities.

Unfolding the "Reemployment Assistance Action." To appropriately resolve the practical difficulties laid-off employees face after they leave reemployment service centers, the government has organized a "Reemployment Assistance Action" drive to extend prompt and effective service to guarantee their basic livelihood, reemployment and social insurance through various assistance measures.

From 1998 to 2001, over 25.5 million people were laid off from state enterprises, of whom over 16.8 million have been reemployed.

Guaranteeing Women's Right to Employment

Special concern has been given to the employment of women in China. The Constitution of the People's Republic of China, Labor Law of the People's Republic of China, and Law of the People's Republic of China on the Protection of the Rights and Interests of Women all contain special provisions on the protection of women's right to employment. The state protects the right of women to work on equal terms with men, applies the principle of equal pay for equal work to men and women alike, and gives special protection to women during the menstrual period, pregnancy, maternity and breastfeeding. The Chinese government and all sectors of society energetically conduct job skill training for women, develop and expand the fields and trades suitable for women to work in, and adopts more flexible forms of employment, so as to provide employment opportunities for women to meet their different requirements.

Helping the Disabled and Other Special Groups to Find Work

The Chinese government attaches great importance to the rights of the disabled to social labor and employment. China adopts the principles of combining centralization and decentralization and encouraging seeking employment on one's own initiative to help the disabled find work. Welfare enterprises are an important form of centralized employment for the disabled. The government grants preferential policies, such as reducing and waiving taxation, to encourage the development of welfare enterprises, so as to increase employment for the disabled. Meanwhile, the government requires all enterprises and institutions to hire a certain proportion of disabled persons, and those which fail to do so must pay a certain amount of money to the employment guarantee fund for the disabled. In the five years of 1996-2000, more than 1.1 million disabled persons were given skill training, and another 1.1 million found jobs, on the strength of government allocations and the employment guarantee fund for the disabled, and the employment rate of the disabled jumped from 70 percent to 80.7 percent.

In addition, the government has established an employment service system for badly-off jobless urban residents, and for older laid-off and unemployed persons. It seeks to arrange jobs for destitute persons by providing funds to support community welfare-type employment organizations, developing community environmental protection, hygiene, security and other services, and providing free employment services. All these measures have achieved the desired effects.