Print

Mail

wiki links

China forced to face joblessness

A demolition crew walks through an old Beijing neighborhood yesterday. Chinese officials say unemployment may soon become a social crisis. PHOTO: AFP

China said yesterday that unemployment is beginning to develop into a crisis. The situation may "undermine social stability," vice minister of labor and social security Wang Dongjin said, quoted by the state-run China Daily.

China's cabinet, the State Council, will hold a national conference later this year in an attempt to work out how China can tackle "the most serious unemployment pressures it has ever faced," the newspaper reported.

China also unveiled a major government paper yesterday on labor and social security reform, which spoke of the problems of mass unemployment, especially for those laid off from state-run firms.

The unusually frank admissions in a country which has traditionally claimed improbably low rates of joblessness follow weeks of industrial unrest centered around China's ailing northeastern industrial heartland.

Many of the demonstrators in what have been among the biggest protests to hit the country in years were laid-off workers from inefficient state firms, a sector many economists expect to suffer even more following China's recent entry to the WTO.

"An excessive labor supply coupled with pressures caused by obsolete job skills has resulted in a grim employment situation in China."

Wang Dongjin, vice minister of labor

"An excessive labor supply coupled with pressures caused by obsolete job skills has resulted in a grim employment situation in China," the China Daily quoted Wang as saying.

He warned it was "a pressing and urgent task to tackle the worsening situation, as it could well undermine social stability."

The "serious" oversupply of labor was expected to peak over the next few years, with 12 to 13 million people entering the job market annually, Wang said.

"But it is estimated that only eight million jobs can be generated annually over this period, even with the country's current economic growth rate," he said.

China's "official" unemployment rate of 3.4 percent does not include those laid off from state companies or the growing army of rural jobless. The China Daily cited Wang as saying 150 million rural laborers were idle, a figure put by the Asian Development Bank this month at up to 200 million.

The potential for unrest amid mass unemployment has not escaped the notice of China's leaders, who in recent months have begun to talk more openly about the unemployment crisis.

This has been coupled with a tough line towards the labour protests, including the arrest of four labour leaders in the northeastern city of Liaoyang.

The decision to hold the national conference on the problem had been taken last month by Premier Zhu Rongji, who has previously expressed concern about the effects of unemployment on the country.

The White Paper on Labor and Social Security in China, was mainly devoted to boasts of improvements made to labor relations and social welfare, but admitted some failures.

The Chinese government was "fully aware that the employment problem in both rural and urban areas will remain sharp, and structural unemployment will become more serious for a long time to come," it said.

It stressed the difficulties of those laid-off by state firms, saying 25.5 million had lost their jobs from 1998 to 2001 with just 16.8 million being re-employed.

A social security net for those in need "has been basically set up," the White Paper said.
This story has been viewed 2241 times.