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Economic Growth Does Not Solve Unemployment, Official
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China's high-speed economic growth will not solve the country's unemployment problem, a National Bureau of Statistics (NBS) official told Xinhua in an interview.


During the Ninth Five-Year Plan period (1996-2000), China's GDP (gross domestic product) grew at an average annual rate of 8.6 percent and 8.04 million jobs were created each year.


During the Tenth Five-Year Plan period (2001-2005), however, GDP grew at an average annual rate of 9.5 percent and only 7.48 million new jobs were created each year, according to NBS figures.


From 1996 to 2000, for every percentage point of GDP growth, there was a 0.13 point growth in the employment figures, but from 2001 to 2005, the same GDP growth only boosted employment by 0.11 points, the official said.


The official attributed the phenomenon to numerous factors, including the migration of rural labor forces to urban areas, structural adjustments to the economy, the impact of reforms and the bankruptcy of some state-owned enterprises.


Over 100 million peasants have migrated into cities to become workers, snapping up job opportunities spawned by fast economic growth, the official said.


But, as the country optimizes its economic structure, China's capital and technology-intensive industries are growing faster than labor-intensive industry.


The economy depends increasingly on technological innovation and capital input for growth. Fewer workers are needed than before, the official said.


The official also referred to the impact of restructuring and closing down state-owned enterprises.


In 1995, there were about 112.6 million people working in state-owned enterprises, but in 2005 the figure had plunged to 64.88 million. In 1991, 36.28 million people worked in collectively-owned sectors, but by 2005 the figure had slumped to 8.1 million.


The official nevertheless expressed confidence about the employment situation, saying the Communist Party of China and the government are very focused on the issue and have made job creation a priority.


The government will develop occupational training to make the workforce more skillful, and support the development of new labor-intensive industries, the tertiary sector and privately-owned enterprises, the official said.


At the end of June 2006, the registered unemployment rate in China's urban area stood at 4.2 percent. In the first half, China's GDP growth rate was 10.9 percent.


(Xinhua News Agency August 29, 2006)

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