IV. Development in the Early Period of the 21st Century

With the implementation of the Tenth Five-Year Plan, for National Economic and Social Development (2001-2005) in 2001, China's labor and social security buildup has entered a new phase of development. During the early stage of the new century, these efforts face both problems to be solved and new opportunities for development. The overall progress of the reform and opening-up and modernization drive has created favorable conditions for solving the problems of employment and social security. The further growth of the national economy and the increase of economic strength have provided a firm material foundation for the enlargement of employment and the improvement of social security. The market-oriented employment mechanism and social security system now basically in place across China have already laid a good foundation for further promotion of the labor and social security undertakings. At the same time, the Chinese government is also fully aware that the employment problem in both the rural and urban areas will remain sharp, and structural unemployment will become more serious for a long time to come. Labor relations are expected to become more complicated, the aging of the population and the increase of unemployment will put more pressure on social security, and promotion of social security in rural areas will still have a long way to go.

Targets and Tasks

The targets for labor and social security development in the early part of this century are as follows: initially forming a comparatively complete labor and social security system corresponding to the development level of China's productive forces and meeting the requirements of the socialist market economy; ensuring well-nigh full employment and basic social security for the majority of workers; safeguarding the legal rights and interests of both employees and employers; enhancing the material and cultural wellbeing of rural and urban residents; and promoting economic development and social stability. The main tasks are to gradually improve the quality of workers and the employment structure, initially form a market-oriented employment mechanism, strive to promote employment, standardize and improve the statistics on unemployment rate, and control the registered rural and urban unemployment rate to within 5 percent; actively adjust labor relations and keep them harmonious and stable; improve the macro regulation and control system of income distribution, work out a rational income distribution relationship, and achieve an approximately 5 percent annual increase in both the per capita disposable income of urban residents and the net per capita income of rural residents; speed up the development of the urban social security system, improve the methods and operating mechanism of fund raising, and promote the socialization of social security management and services; with farmers' old-age security and health security of multiple forms as the guide, actively explore in rural areas a basic security system suited to the socialist market economy system and the country's economic development level and set up a system to help the weak group in society to take care of their own life and work.

Policies and Measures

  • Carry out an active policy for promoting employment and do everything possible to enlarge the scale of employment. Rapid economic growth shall be maintained, domestic demands shall be expanded, and new employment opportunities created to the full, so as to increase total employment. The employment structure for labor force should be improved, and great efforts made to develop labor-intensive industries and enterprises. Tertiary industry, small and medium-sized enterprises and the non-public sectors of the economy shall be taken as the main channels for the enlargement of employment. Preferential policies shall be further carried out so as to help laid-off and jobless people to find reemployment.
  • Establish a unified and standardized labor market, make a unified plan for rural and urban employment, and ameliorate the employment service system. The reform of the labor personnel system and the household registration system shall be deepened, and efforts made to guide the orderly flow of the labor force between urban and rural areas or between regions so as to promote the transfer of surplus agricultural labor. The service of public job agencies shall be improved and community-run job agencies encouraged to develop along healthy lines.

  • Improve the quality of workers in an all-round way and adopt flexible forms of employment. The labor reserve system and employment permit system shall be carried out. Vocational education, continuing education and reemployment training shall be strengthened, and the professional qualification certification system enforced. More attention shall be paid to job skill training for rural workers, and a sound job training system established and improved in rural areas step by step. Flexible forms of employment shall be adopted, and finding employment on one's own encouraged.

  • Consolidate and improve the labor contract system, make great efforts to carry forward the group contract system and promote the establishment of a tripartite coordination mechanism for labor relations. Active efforts shall be made to formulate and revise the state's basic labor standards, and a labor standard system suitable to China's actual conditions be perfected. The system of handling labor disputes shall be further improved, gradually enhancing the comprehensive ability to prevent and handle labor disputes.

  • Promote the reform of the wage and income distribution system and establish an incentive and restraining mechanism for income distribution. The minimum wage system shall be improved and the wage guidelines and the guidance price level system for the labor market be enforced across-the-board. Efforts shall be made to continue the experiments in the collective wage consultation system, standardize the payment of wages and guarantee the legal rights and interests of employees with respect to their work remuneration.

  • Deepen the reform of the social security system, speed up the building of the social security system and actively implement the pilot program for its improvement. For this, we need to establish a reliable and stable social security fund-raising mechanism, restructure financial expenditure, increase necessary input and the amount of social security funds, and rationally adjust the payment rate and substitution level, and improve the operational efficiency of social security funds and the efficiency rate of investment. The social security macro-regulation and supervision system shall be bettered and its management level and efficiency raised, so as to ensure the stable, healthy and orderly operation of the social security system.

  • Improve the basic old-age insurance and basic medical insurance systems and encourage employing units, where conditions are favorable, to set up annuity and supplementary medical insurance programs for their employees. Further steps shall be taken to improve the unemployment insurance system and make the basic livelihood guarantee system for laid-off personnel from state-owned enterprises part of the unemployment insurance scheme. Development of the industrial injury and childbirth insurance systems shall be accelerated. The basic old-age pension insurance system for employees of state organs and institutions shall be improved. The system for ensuring a minimum standard of living for urban residents shall be standardized. We shall accelerate community building and promote the socialization of social security. We shall explore diverse forms of security and push forward the building of the basic security system in the rural areas. We need to improve our policies concerning social relief, social mutual aid, the special care and placement system and social welfare, and safeguard the legal rights and interests of women, minors, the elderly and the handicapped.

  • Establish a supervision and management system concerning social security funds through a combination of administrative supervision, social supervision and internal institutional control. While establishing and improving the social security system, we shall explore the right path for investment management and establish a fund supervision and management system coordinative with the fund management system in accordance with the fund management principles of different security projects. We shall work hard to guarantee or increase the value of the social security funds and resolve the operational risks of the security funds, so as to safeguard social safety and stability.

  • Press ahead with the legal system building in the labor and social security fields, improve the labor and social security supervision system, steadily enhance the overall quality of supervision and law-enforcement personnel, carry out supervision activities of diverse forms, and push forward the organic integration of labor security supervision and law-enforcement departments with all social sectors in implementing legal supervision. We shall strengthen the building of the labor security management information system and the popularization of the scientific findings in this aspect so as to improve the scientific, standardized, institutionalized and IT management of the labor and social security undertakings. China will continue to actively participate in international activities in the fields of labor and social security, and expand cooperation and exchange with other countries, so as to continue to play its promotional role in international labor affairs. We will adapt ourselves to the new situation arising from our WTO entry, and work hard consistently to carry our labor and social security cause further forward.