Some 3 million workers may lose their jobs every year until 2006
as China's over-staffed state firms streamline. By then state-owned
firms are expected to finish restructuring.
?
State-owned firms are expected to finish restructuring by 2006,
said Zhang Silin, minister of labor and social security.
Still, "re-employment will remain a hard nut to crack," said
Zheng.
The government boasted of its success to date, helping 4 million
laid-off workers find new jobs last year and keeping the registered
urban jobless rate at 4.3 percent, below the goal of 4.5 percent,
set in early 2003.
But there are still 2.7 million laid-off workers waiting to be
employed.
Meanwhile, unemployment numbers will continue to rise as more
money-losing state-owned enterprises regroup and close.
In December, Zheng's ministry announced plans to help 5 million
laid-off workers find jobs in 2004 and to keep the urban jobless
rate at around 4.7 percent.
Zheng said the goal could be achieved if the economy maintains
rapid growth and policies favoring re-employment are
implemented.
In three years, the government will close re-employment service
agencies.
Lay-offs will then be handled by the country's security net of
jobless insurance, said Zheng.
Employment agencies were introduced nationwide in 1998 as an
interim program to help workers let go from money-losing
state-owned enterprises.
Since 1998, reforms have increased both efficiency and the
number of laid-off workers. About 27.8 million employees have lost
their jobs due to amalgamations or bankruptcies in the past five
years.
Laid-offs workers, who are usually paid meager sums for basic
living necessities in line with a three-year contract by
re-employment agencies, are not included in unemployment
numbers.
After the contract expires, laid-off workers still not
reemployed will be reclassified as jobless.
The closure of re-employment agencies, aimed at setting up a
sound labor market suitable to the market economy, will push the
unemployment rate higher, said Cai Fang, director of the Institute
of Population and Labor Economics at the Chinese Academy of Social
Sciences.
That's because a large proportion of the remaining laid-off
workers will be added to the jobless rolls as a result of obsolete
working skills, he said.
Technological training and upgrading are essential, as China has
enters a "pivotal period" in restructuring its economy, said Lu
Zhongyuan, director of the macroeconomics research department of
the Development Research Center of the State Council.
Lu said such "structural" unemployment is unavoidable, as labor
moves from the agriculture sector to manufacturing industries,
which are more technology- and capital-intensive.
"A deeper-seated reason is the population growth in the world's
most populous nation," Lu said, adding that many employment
opportunities are offset by population growth.
"Some 24 million more jobs are needed this year, to absorb the
new labor force which includes migrants and college graduates," Lu
said.
"It will take another generation for China to slow down its
population growth," he added. "And the employment pressure won't be
alleviated within 20 to 30 years."
(China Daily January 9, 2004)
