Employment and unemployment in China, Japan and Russia
Traditionally, employment of the population is considered an important indicator of the successful development of a country. Providing jobs is the most important task of the Chinese government in the near future. Despite good rates of economic growth, it is not possible to ensure full employment of the population. According to forecasts, the labor force should increase to 772.8 million people by 2030. However, already in 2005 the number of employed people exceeded the forecast and amounted to 778.8 million. people, of which 45% are in the agricultural sector, 24% in industry and construction, 31% in the service sector. There were 273.3 million employed citizens.
Official unemployment in the city in 2005 was 4.2% and has not changed to this day. In 1999 and 2000 this figure was 3.1%, then increased to 3.6%, and this occurred against the backdrop of economic growth of 7.5 and 8.4%. According to international standards, unemployment should not exceed 5-6%. At such indicators, full employment is considered to be maintained. Chinese economists cite the so-called real unemployment rate, which is higher than 14% for the city (and city residents make up 42.3% of the total population). In the villages, unemployment is even higher.
Unemployed persons are considered to be persons officially registered as unemployed, and since 1999, all layoffs from state-owned enterprises ("syagan") receive unemployment benefits, but are not included in the category of unemployed. In addition to those officially listed as unemployed, there are also peasants in the city who came to work. These people are neither “employed” nor “unemployed”, since there is no data on unemployment in the countryside, and they are not classified as urban residents.
In China, the unemployed are divided into several groups. In the city, unemployed persons are considered to be persons who have not found a job within a month after dismissal or transition to the group of able-bodied people. After 24 months, these people are no longer unemployed and no longer receive unemployment benefits (even if they have not found a job). This policy is aimed at stimulating employment growth.
Another group is the "Xiagang" (reduced from state-owned enterprises). Providing work for people who moved into the “Xiang” category in connection with the creation of a “system of modern enterprises” has become serious and has become a special phenomenon of the time.
In terms of age composition, for example, in Beijing, “xiagang” under 15 years old make up 6%, 26-35 years old - 29%, 36-45 years old - 46%, over 46 children - 19%, in Anhui province - “xiagang” from 31 to 40 years make up 47%. In Beijing and Shanghai, the share of women among the “shagang” is 55%.
In the future, one of the main problems will be the provision of jobs to surplus labor from the village - the third category, which replenishes the army of unemployed. However, already now landless peasants are a problem not only for the leadership, but for the entire country. The movements of more than 100 million people wandering around the country in search of work cannot go unnoticed.
On the one hand, migration is profitable for the state. Moving surplus labor out of the countryside benefits both the city and the countryside. The city receives income in the form of taxes and consumer spending (80-100 billion yuan per year), the village - in the form of earned capital (about 120 billion yuan annually). If we also take into account the transport costs of this population when moving around the country from home to their place of work, then they collectively provide a decent increase in the gross product. On the other hand, migrants from the village have no guarantees of their existence or confidence in the future, because, stopping at one construction site today, they do not know whether they will have to look for a new job or shelter the next day.
As the population grows, unemployment will also increase. This raises serious concerns among researchers and the government.
employment unemployment
Social Security in China
The development of the social security system is directly related to unemployment and the emergence of a socially vulnerable population as a result. In 2002, the term “socially vulnerable population” appeared for the first time in China. Four groups were assigned to it: 1) “syagan”; 2) people “outside the system” (of enterprises), who are not employed at state enterprises and, accordingly, do not receive any support in the event of dismissal or disability. This also apparently includes disabled people and orphans; 3) rural workers in cities; 4) early retired workers in the “system of (state) enterprises.”
Considering the modern social insurance system, it should be noted that not all groups of the socially vulnerable population are covered, and then mainly only in cities. Currently it has four levels:
1. Social insurance for unemployment, old age, health insurance.
2. Providing education and benefits for disabled people and minors.
3. Ensuring a living wage.
4. Social assistance - benefits for certain segments of the population. Let's consider two of them - social insurance and ensuring a living wage.
The social security system in China was established by the 1951 Constitution, but its practical formation began during the Seventh Five-Year Plan of 1986-1990. Judging by the legislation, the solution to the problem of social security began to be seriously addressed since the 1990s. The “Regulations on Unemployment Insurance”, “Temporary Regulations on Social Insurance Contributions”, “Regulations on the Living Minimum of Urban Residents” formed the legal basis of the social security system.
As for pensions, there is a clear division between employees of state and non-state enterprises. Official sources claim that the pension insurance system covers not only state-owned enterprises, but also 51.5% of collectively owned enterprises, 34.2% of enterprises of other types of property. In 2005, in cities, 174 million people were registered in the old-age social insurance system, of which 131 million were working people, about 43 million were pensioners. In 1998 this was 85 million. enterprise workers and 27.3 million pensioners. In 2002, 99.9% of pensioners of state-owned enterprises received old-age pensions on time and in full.
Currently, China has a pension contribution system. The pension consists of company contributions in the amount of 20% of the salary fund and 8% of the employee’s salary. The amount of the pension depends on the place of work and local government regulations. Employees of closed enterprises are provided with pensions in accordance with the subsistence minimum by the local administration.
Unemployment benefits are issued to officially registered unemployed people in the city who are looking for work. The unemployment benefit is below the minimum wage, but above the subsistence minimum; the longest period for receiving unemployment benefits is 24 months. The unemployment insurance system in 2002 in the city extended to 103 million people (in 1998 this figure was 79 million people).
Medical insurance is also provided from the savings funds of the employee himself and his enterprise (for an employee no more than 2% of wages, for an enterprise - no more than 6% of the total wage fund). This system applies to workers in cities. In 2005, it covered 137 million people, which is 13 million more than in the previous year. In 1998, the number of workers with basic health insurance was less than 19 million people.
The subsistence level system was introduced only for city residents. The living wage is set according to World Bank standards. According to the exchange rate, it should be around 250 RMB per month per person. According to purchasing power parities - about 60 yuan. According to official data at the end of February 2002, more than 13 million. people across the country were provided with a living wage. In 2005, 22.3 million people in cities and towns received subsistence benefits. For comparison: in 1998 - 1.8 million.
The level of minimum subsistence benefits is differentiated by different cities. In 1993, Shanghai was the first in China to introduce a subsistence allowance, which was paid to low-income urban residents from among the employed, unemployed and pensioners. In this city, the monthly allowance per person is approximately 280 yuan. In other central cities (except Chongqing) and the five cities designated by the plan, the cost of living is 200-319 yuan, in Chongqing and the administrative centers of 23 provinces - 140-200 yuan, in district-level cities - 110-140 yuan, in county-level cities - 78- 110 yuan.
The provision of socially vulnerable segments of the population, the main ones of which are pensioners and the unemployed, is perhaps one of the most important criteria for the state of society, and therefore economic development. In China, this area is underdeveloped. The government still has serious work to do to improve the system of social guarantees throughout the country.
New developments in the labor market and workforce management in Japan
The enormous changes that occurred in the Japanese economy during the 20th century did not seem to affect the field of labor and labor relations at all. Almost until the end of the century, market relations here were in their infancy. Large business essentially monopolized a significant part of the workforce, as if “closing” it from the outside world with the help of a special form of long-term employment - the so-called lifetime employment system. The most important consequence of lifelong employment was the division of the labor market into two parts - closed and open, within which the labor force was placed in different conditions in terms of stability of employment. In a closed market, labor mobility is carried out within the management system of each company. Due to the significant interconnectedness of large Japanese companies, these systems interacted with each other, forming a conditionally single closed labor market.
The other part of the labor market served small and medium-sized businesses. Here the workforce was not so strictly tied to any one firm, and its mobility was not limited by the boundaries of individual companies. This labor market is usually called open. However, the division of the labor market into open and closed was rather conditional, because small businesses using the open labor market also fell within the sphere of influence of large ones. Despite significant differences and the existence of a very definite boundary between these two parts of the labor market, they were inextricably linked with each other.
The open market in Japan has always been a kind of enclave of “second-class” labor, which is destined for a peripheral position. On the contrary, that part of the labor force that entered the closed market was provided with various privileges and, above all, the privileges of employment itself. The privileged position of the closed market in relation to the open market, dominance over it, has always been supported by the Japanese state.
The state almost never interfered in the functioning of the closed labor market. Until now, there are special employment and vocational training systems that are controlled by the companies themselves. The open labor market, on the contrary, has traditionally been quite strictly regulated by the state. Thus, the state, “due to the potential for significant abuse,” did not allow private business into the field of employment of labor rotating in this market, and it remained in its infancy. The monopoly on intermediary services in the field of employment belonged to the public employment service (Public Employment Service Office - PESO).
By the beginning of the 21st century, the open labor market in Japan still continued to represent a sphere of low-skilled, peripheral labor, which was characterized by specific forms of employment, primarily part-time employment.
Part-time employment began to develop rapidly in Japan in the 70s and especially in the 80s of the last century under the influence of the deteriorating socio-economic situation in the country and with the threat of an increase in the unemployment rate, when the number of permanent jobs began to decline. This form of employment gradually gained particular popularity among women. By the end of the 1980s, there were more than 5 million part-time workers in Japan, which accounted for approximately 12% of the total number of wage earners. Of the total number of part-time workers, about 70% were women.
Traditionally, part-time jobs were also offered where the performers did not require a high level of qualifications. Part-time employment has become particularly widespread primarily in the service sector. This form of employment was highly flexible and could quickly respond to weekly and even daily changes in demand in the labor market. However, gradually other sectors of the economy began to show demand for part-time employment, even high-tech industries and production, as well as the spheres of education, science, and social services. Among the part-time workers, there are specialists with higher education and “specialized workers,” whose work required certain skills and sometimes extensive preliminary professional training.
The most characteristic feature that has emerged in the institution of part-time employment in Japan is related to the length of working hours. In relation to part-time workers, the common practice for Japanese companies of involving staff in overtime work is acceptable, which was even enshrined in the employment contract as one of the mandatory conditions of employment. This situation practically blurred the essence of the very concept of “part-time employment” and erased the fundamental typological differences between this phenomenon and full employment.
With long working hours, almost all companies offered only hourly wages, which automatically meant the absence of any additional types of incentives, which are very common in Japanese companies for permanent staff and amount to up to 50% of their total earnings. On the contrary, there was great uniformity of conditions here, since the companies showed great solidarity on this issue. Typically, all companies agreed with each other on the issue of determining the form and level of remuneration for part-time workers, which turned employers in the part-time employment market into monopolists.
The status of part-time workers was fixed in an individual contract, and discriminatory conditions for the use of their labor were combined with the deprivation of guarantees in the field of employment and social rights entitled to permanent workers.
Currently, the operating conditions of large Japanese business, with its traditional reliance on its own domestic labor market, are changing. In the last one and a half to two decades in Japan, this process has been influenced by factors that are structural, enduring in nature and causing fundamental changes in the current reality. Among these factors are the restructuring of the production and economic structure in the context of economic globalization, the formation of an information society, the rapid aging of the population, individualization and diversification of the labor market.
Major changes in the system of labor relations are brought about by the emergence of new qualitative characteristics of the labor force, the intensified transition from “collective labor” to “individual labor”. An individual, often highly qualified worker is increasingly entering the Japanese labor market as an independent subject of labor relations, trying to contrast his interests with the interests of the employer. Young people have especially changed, as they no longer spend their entire working lives with one employer, as before.
The state employment system fails to cope with its functions, and the activities of PESO in many cases cease to meet the needs of the labor market. At present, even PESO’s intermediary services for connecting labor market subjects with each other cannot be considered full-fledged and sufficient in regulating the market, since entire areas of labor activity, professions and categories of employment, whose representatives are increasingly entering the open labor market, fall out of their scope of attention. More businesses and employees stopped turning to PESO and began using other sources of information, including the media.
Although the new law was intended to provide greater freedom of action for the private sector, the role of the PESO system, according to experts, should remain key in the field of intermediation and, as such, organize broad and comprehensive monitoring of labor market indicators and provide assistance to both companies and the workforce.
It was decided to introduce alternative forms of intermediary services in stages, so that a radical restructuring of the existing employment system would not lead to its complete destruction. At the first stage, in 1985, the long-awaited Law on Rehire of Labor was adopted, which finally allowed private agencies to engage in employment of the population. Based on a specially issued permit or by submitting a report to the inspection service of the Ministry of Labor, such companies received the right to leasing labor, i.e. to hire her and then place her at the disposal of another employer.
The law strictly defined the scope of activity of private intermediary companies, indicating exactly which types of activities can be the object of leasing. The terms of the contract on lease terms through leasing enterprises were not limited. This increased the status of employees, equating it to the status of permanent workers, which also influenced their level of possible earnings and the degree of social guarantees. The unlimited term of the employment contract automatically gave the right to unemployment insurance, medical and pension insurance.
This situation of the rehired labor force, proposed by the law, differed for the better from the situation of the corresponding contingents in those countries where the leasing business in the field of labor (the so-called temporary work enterprises - TWP) became quite widespread back in the 70s of the last century. Unlike Japan, this business is practically not limited by legislation in terms of coverage of the labor market.
Rehiring of labor began to be practiced especially widely in Japan in the post-war period of the 20th century. After the oil crises of the 1970s, it was well known to big business as a means of preserving the system of lifetime employment. As a fairly developed mechanism, it ensured the movement of labor within the closed labor market and became its necessary part.
Since the mid-1970s, when companies were faced with the need for large-scale restructuring in business, the “delegation” of personnel from some business sectors, usually in decline, to other, more successful ones, acquired a wide scale and systematic character. These movements were not limited to the parent company, but applied to all its branches and even subcontractors. The main reason for this phenomenon was the desire of companies to maintain the principles of lifelong employment in relation to their core personnel in conditions of low growth rates and structural restructuring of the country's economy.
The significance of this law is that it potentially provided access to the open market for skilled labor that was not in demand at large enterprises. After the legalization of the activities of private employment agencies, the position of rehired personnel in the labor market improved markedly.
In the 90s of the last century, the issue of the development of the labor market moved to a different, more pragmatic plane, which was greatly facilitated by the deterioration of the socio-economic situation. The legislative ban on layoffs of personnel and state control over the implementation of this ban quickly weakened. The growth of unemployment among employees of large companies, especially among middle-aged and older people, has advanced the problem of developing an open labor market to such an extent that it has come to be considered as “one of the most important tasks of the entire policy of the Japanese government on economic deregulation.”
In 1999, private enterprises engaged in the rehiring of labor were allowed to operate in a wide range of professions and occupations. The ban applied only to certain types of work related to port transport, construction and security activities. The procedure for obtaining licenses has been significantly simplified. At the same time, the activities of these enterprises were subject to certain supervision rules and restrictions from the Ministry of Labor. For violation of the established order, a system of administrative penalties was provided.
The changes made to labor legislation in 1999 to develop an open labor market are considered so large that they are often called labor reform. However, the goals that were originally aimed at deregulating the labor market have still not been achieved. Complete liberalization of the labor market, which removed all restrictions on the activities of commercial employment agencies and on all types of labor activity, was achieved in Japan only in 2004.
Since commercial agencies assume the costs of recruiting, training and social protection, companies resorting to leasing significantly reduce their labor costs. According to the Ministry of Labor, in 2003 the number of such workers was 1.79 million, an increase of almost three times over the previous year.
Currently, about a third of Japanese firms use personnel obtained through leasing for purposes directly related to the solution of basic and specialized tasks. According to the Department of Labor, companies surveyed in 2003 cited the desire to have enough competent workers on hand to perform basic (39.6% response) and specialized functions (25.9% response) as the main reasons they use temporary staff. that the importance of temporary staff in firms is increasing. At the same time, companies are clearly faced with the task of treating this staff in the same way as the main contingent, i.e. as an equivalent management object, with a high level of labor motivation, the necessary qualifications and in need of appropriate labor compensation.
The difficulties of managing such a workforce are due to two circumstances. The first of them is due to the fact that such personnel are hired by two employers at once. One of them is a commercial agency that hires a person nominally, without providing a workplace. Another employer (manufacturing, trading or other company) takes his agency “on loan” in order to actually use his labor. Since management functions under the terms of this model are duplicated by two unrelated employers, constant inconsistencies and inconsistencies arise in all areas of management.
Another circumstance that causes problems in the field of temporary staff management has a direct bearing on the timing of its use. As is known, contracts with temporary personnel in Japan, unlike permanent ones, are concluded with a strictly established period of validity. Keeping in mind that sooner or later such personnel will be fired, the employer (in this case, both employers) avoids taking on unnecessary obligations in relation to them. As a result, no matter what value the labor force hired under leasing represents, the contradictions that arise in as a result of its double subordination, cannot but intensify due to its temporary status. This invariably affects the effectiveness of temporary staff management.
Personnel qualifications in Japanese companies are usually divided into two levels. At the first level, requirements are placed on such abilities and skills of the employee that allow him to perform production tasks that are more or less common to a wide range of companies. The second level assumes that the employee can perform work specific to a particular business, often for a single company. This qualification requires detailed knowledge of the specific production or other type of activity of this company. To acquire such a level of qualifications, an employee must adapt to the complex of conditions prevailing in a given business.
The modern system of labor incentives in Japanese companies is already largely organized on the same principles as in the rest of the world. When calculating earnings, the importance of such traditional Japanese factors as age and length of service of the employee is gradually decreasing. The first step is gradually to evaluate the results of work, the abilities of personnel, their qualifications, and attitude towards work. The process of stimulating labor appears in the duality of its main components - the assessment of invested labor based on the totality of factors influencing it, on the one hand, and remuneration based on the results of this assessment, on the other. Work motivation of personnel under the conditions of such an incentive system depends not only on the amount of direct remuneration, but also on the nature of the work allowed to be performed and indirectly affecting the level of payment.
In the existing system of stimulating the labor of temporary workers employed under leasing, due to the presence of two employers, the essentially inseparable functions of stimulating labor were divided. The amount of payment and the distribution of labor by company type of work is carried out by employment agencies, which are in charge of the search and selection function. The assessment of the invested labor, on the contrary, is carried out by the client company, since only here it is possible to track the behavior of the employee in the labor process, evaluate his attitude towards him, determine with the greatest accuracy the amount of this labor and obtain all other information related to this issue. The company submits information about the results of the employee’s job evaluation to the employment agency, and this limits its participation in stimulating his work.
The current attitude of employers towards the problem of disincentivizing personnel employed under leasing conditions cannot but have a detrimental effect on work motivation. Forced in every possible way by firms to achieve high labor productivity, such workers consider themselves entitled to receive appropriate remuneration and count at least on the renewal of their employment contract. However, having become convinced that their expectations are unfounded, they gradually lose interest in work and become apathetic, uninitiative statists, suitable for performing only the most routine functions.
The main prerequisite for solving the problems of managing labor coming from the open labor market, in the opinion of a number of Japanese scientists, should be a change in attitude towards it on the part of business. Taking into account the changed conditions of economic activity at the present stage, they call for seeing in the open labor market a constant and reliable source of labor, promising for fully satisfying new business needs.
According to researchers who have studied the problem of the effective use of temporary labor in Japan in modern conditions, its solution, due to its complexity and the presence of many diverse aspects, requires joint efforts and measures on the part of both business and intermediary employment structures. In addition, more decisive government measures are also needed to further liberalize the labor market.
Prospects for the development of the Russian labor market and ways to improve its functioning
In social and labor policy, measures aimed at developing and implementing mechanisms that facilitated institutional changes in property and structural changes in the economy initially prevailed. The most important of them were maintaining incomes at an optimal level and guaranteeing employment in the face of a decline in production and rising unemployment. In line with the democratization of society, labor and employment legislation was modernized by bringing it in accordance with internationally recognized rules: the working week was shortened, the minimum duration of vacations was increased, employment guarantees for the unemployed were expanded, and social insurance reform began. Regulation of social and insurance relations contributed to their normalization during the privatization of the economy.
The steady growth of structural unemployment predetermined the need to transform employment funds into a full-fledged social insurance system. Unemployment, from a negative phenomenon, turned into a permanent factor in the development of the labor market and increased competition for jobs. It was necessary to take into account its objective nature, its dependence on the processes of economic reform, and to look for new forms of effective employment.
With the country's transition to the stage of development of a market economy, changes arose in the life of society in its entirety and in its individual sectors. In particular, changes have occurred in the labor market, which has led to a number of problems.
Unemployment is a factor that lowers wages. Thus, the negative consequences of unemployment are not limited to those who are victims of it. It can hit entire work groups, including trade unions, thwarting their attempts to improve the quality of jobs, working conditions, introduce additional benefits and ensure other human rights in the workplace.
Particularly important is the social liberalization of wage labor, primarily through a radical reform of labor legislation in full compliance with the requirements of a market economy. As the owner of a unique product, he has rights to priority in the labor market; its price is formed depending on ability, education, qualifications, and experience.
State guarantees for the unemployed population should replace compulsory insurance for structural and professional unemployment. It is also necessary to improve the functioning of social insurance funds through stable payment of social unemployment benefits, increasing the cost of living, taking into account inflationary processes. Speaking about the functioning of the pension fund, it should be noted the need to increase the share of contributions from the employee’s salary.
We should also strive to maintain the relationship between employment, wages and investment in an optimal ratio, which is a condition for social and economic balance. Only in this way can a reliable economic basis be ensured for the creation of new jobs that expand the scope of effective employment, which, in turn, will lead to the “resorption” of unemployment and a decrease in its level while stabilizing development. It is then that it becomes possible to create in the foreseeable future a dynamic social and labor sphere adapted to deep market transformations in the economy.
Attracting investments from the state will effectively influence the functioning of the labor market.
Due to the ineffective work of the employment service, there is an increase in the number of unregistered unemployed people who do not consider it necessary to contact the employment service and sometimes find alternative sources of livelihood. This indicates an increase in activities not taken into account by government statistics and requires increased control by government bodies.
The employment policy should also be changed in relation to the requirements placed on the employee. First of all, you should pay attention to the qualifications and education of the employee, although currently for our country one of the main requirements for employment is the employee’s length of service, as well as his age, which is often an obstacle to finding a job.
Bibliography
1. MakarovaE. A. Social security // Labor abroad. 2007. No. 4(76).
2. MakarovaE. A. Employment and unemployment // Labor abroad. 2006. No. 4(72).
3. Ayushieva E.B. Reform of the social sphere: problems and consequences of implementation // Labor and social relations. 2007. No. 3(39).
4. Makarova E. A. Dependence on benefits and employment in China // Labor abroad. 2009. No. 2(74).
5. Makarova E. A. Labor market in Japan // Labor abroad. 2007. No. 3(75).
For a long time, China was a mysterious country and only a few decades ago they started talking about it seriously. The People's Republic of China is a country with a huge area. In terms of territory size, China ranks third. The state has direct access to the Pacific Ocean, which allows it to successfully export its products throughout the world. Its territory includes desert and mountains. He owns 3,400 islands of varying sizes. It is famous all over the world for its culture, cuisine, and industry.
Population
For a long time, the population of the People's Republic of China has been growing rapidly. Today the country has more than one billion three hundred thousand inhabitants. The age category of the country is middle-aged people. This trend is due to the law of the country, which states that there should be only one child in one family. China is a country where urbanization is leading. Recently, urban areas have expanded significantly, while the rural population has decreased several times. This trend is due to the rapid development of industrial facilities in large cities, which require workers.
The country's leadership is concerned about the rapid rate of increase in the population, which is why for several decades in a row the rule has been in force that a full-fledged family can only have one child. The exception is rural areas. This law does not apply to the country's ethnic minorities. But no matter how hard Chinese officials try to stabilize the birth rate, statistical data indicate population growth. This trend will continue in the future. The Chinese are a religious people. Most of them profess Buddhism. But official data show that there are more than 20 million Muslims, 10 million Catholics, and 12 million Protestants in China. The Chinese speak many languages, but everyone speaks the so-called standard Chinese language.
Industry of China
China has the largest number of industrial enterprises in the world. These are heavy industry enterprises that employ more than 3/5 of the country's working population. The People's Republic of China is widely introducing the latest world technologies into industry. The country pays special attention to new products. This helps it to be one of the most developed countries in the world. Special attention is paid here to saving energy resources.
Most of the industry controlled by the state is located in the largest cities. This is what contributes to the process of urbanization. Residents are eager for new technologies, trading the countryside for a bustling city.
Main industries
The energy industry is particularly developed in China. Coal mining and oil production of varying quality occupy leading positions. The country has more than 100 large coal mining enterprises on its balance sheet. Gas is produced in small quantities.
The metallurgical industry is working at full capacity, but its own production cannot meet the needs of the industry. China has deposits of tungsten, manganese and other raw materials used to make long steel.
Mechanical engineering is also developed at a special level. The country specializes in the production of machine tools and various equipment, heavy vehicles. Of particular importance are enterprises that specialize in the production of automobiles. This type of mechanical engineering is growing at a rapid pace.
Over the past decades, China has taken a leading position in the niche of microelectronics and electronic technologies due to the huge number of both small and large enterprises for assembling a wide variety of electronic devices, exported throughout the world.
The products of chemical industry enterprises are in demand all over the world. China produces mineral fertilizers for the whole world.
But the most popular industry in China is considered to be light industry. This is where the majority of workers are employed. This is the most economically profitable industry in the country. Absolutely all areas are developed here, but especially the textile and food industries.
Agriculture in China
In the People's Republic of China, agriculture is of great importance, especially the cultivation of a wide variety of crops. The country occupies a leading position in the world in the number of types of crops grown: 50 field species, 80 vegetable species and 60 garden species. More than half of the country's population is employed in agricultural work.
The PRC specializes in growing grain crops, especially rice. This crop is grown throughout the country. But wheat cultivation is not far behind. China is located in different climatic zones, due to which a wide variety of agricultural crops are grown. The cultivation of tea and tobacco, cotton, and sugar cane is very developed. The country also grows fruit crops and vegetables in large quantities.
Breeding animals, birds and fish
Livestock farming in the country depends on the food supply, and these are pastures. That is why cattle breeding and pig breeding are developed here. Animals are raised in a nomadic way. Breeding cattle and poultry also occupies a special place in agriculture.
China is the world leader in aquatic products. The country uses rice fields for fish farming. Unique technology and a favorable climate make it possible to engage in different types of agriculture in one place. But recently, China has also begun to use natural sea shallows, which have been transformed into “farms” for raising various marine inhabitants.
China is a very interesting country with a rich culture and its own traditions. The population of the People's Republic of China is very hardworking. Competent policies and a huge amount of labor resources have allowed the state to become a leader in the world in many sectors.
If we sum up the economic situation in China over the past year in just one word, it is unemployment. A huge number of bankruptcies, a reduction in foreign investment; 300 million migrant workers are losing their jobs; The government is forcing troubled public corporations to stay in business to save jobs and encouraging migrant workers to return to their homelands to open new businesses - it's all about unemployment. /website/
Coal and steel industries in decline
The coal and steel industries were the largest employers in China. The coal industry employs more than 5.8 million people, and the steel industry employs 3.3 million. The bankruptcy of enterprises in these two industries will inevitably lead to mass unemployment.
On August 24, 2015, the State Council released a report on risks in the coal industry, which stated that 4,947 (48%) Chinese coal mines had closed or stopped production. In other words, coal production in China has dropped by almost half. Shaanxi, Shanxi, Inner Mongolia and other coal-rich provinces were seriously affected. In Inner Mongolia, the country's largest coal reserve, half of all mines are closed or in limbo, and more than 100,000 people are unemployed. The decline in the coal industry began in 2013, with many companies struggling to survive, but to no avail.
The situation in the steel industry is similar. Large excess capacity led to low profits for the entire industry. According to insiders, an inventory of all types of steel was carried out over the course of five years. In early August 1915, the price of steel was 1,800 yuan ($273) per ton, or 0.9 yuan ($0.14) per pound (453.6 g) - cheaper than cabbage.
These data indicate an economic slowdown and weak industrial demand. Manufacturers say things will get even worse in the steel industry. There are currently 2,460 metallurgical companies in China. This number is expected to fall to 300. This means that more than 80% of businesses will be merged and acquired, and steel production will undergo restructuring and liquidation over the next three years.
The "World Factory" has moved to other countries
In recent years, with rising labor costs in China, many companies have moved their factories to Vietnam, India and other Southeast Asian countries to maintain profits. According to the Asia Footwear Association, a third of orders from Dongguan, the “footwear capital,” went to Southeast Asia. The decline in Dongguan began in 2008, with 72,000 businesses closing by 2012, and at least 4,000 businesses in 2014. In October 2015, more than 2,000 Taiwan-funded enterprises in Dongguan closed and five million workers were laid off.
The printing and packaging industries serve the final stage of the goods manufacturing process and serve as a barometer for the ups and downs of the manufacturing industry. China has 105,000 printing enterprises employing 3.4 million workers. Printing and packaging are the main industries in Guangdong, with production falling, they are receiving fewer orders and the unemployment rate is gradually rising. Employment in these sectors fell from 1.1 million in 2010 to 800,000 in 2014.
Unemployment data
In 2010, Vice Premier Zhang Dejiang noted that 45 million jobs in China were created by foreign companies. By supporting businesses, foreign investment has provided more than 100 million jobs in total. Justin Lin mentioned this at the World Economic Forum in January 2015. Lin said China would lose 124 million jobs if the entire manufacturing sector left the country.
Before 2010, China already had a huge number of unemployed people. On March 22, 2010, Premier Wen Jiabao told US representatives at the 2010 China Development Forum: "The US government is worried about two million unemployed people, but China has 200 million unemployed people."
Researcher Lu Tu studies the issue of migrant workers in China, that is, those whose home is in rural areas and who work in cities while living in slums there. She says there are 300 million new migrant workers in China. Taking into account their parents and children, this number will be 500 million. Their influence on Chinese society should not be overlooked. In other words, the wealth of these 500 million people affects China's social stability.
Social instability
If one plant lays off 10% of its workers, people may think that the workers were probably not meeting production requirements. If 50% of companies downsize, this can be attributed to a market downturn. But if companies leave the country and hundreds of millions of people become unemployed, then this is the beginning of a great depression. In this situation, unemployment is not only a problem for the unemployed themselves, but also a social problem that the government and the entire society will face.
China's economy is approaching this point. China currently does not have the technology, resource or human capital advantages to recover quickly, so the country must prepare for long-term unemployment.
Unemployment leads to the emergence of a group of disenfranchised internal refugees. The Chinese Communist Party should not forget that the social basis of the communist revolution in China in the 20th century was the huge number of unemployed people.
This is a translation from Chinese of an article by He Qinglian posted on her blog on December 29, 2015. He Qinglian is a renowned Chinese economist and writer, the author of China's Trap, about corruption and China's economic reforms in the 1990s, and The Fog of Censorship: Media Control in China. She writes regularly about contemporary Chinese social and economic issues.
From January to September of this year, the number of people working in Chinese cities increased by 10 million 660 thousand people. This means that the target set at the beginning of the year for an annual increase in urban employment of 9 million was achieved ahead of schedule. This was recently announced by official representative of the Ministry of Human Resources and Social Security Yin Chengji at a regular press conference.
Mo Rong, director of the research institute of the Ministry of Human Resources and Social Security, noted that the large scale of the Chinese economy has ensured stable employment levels even in the face of slowing economic growth.
“In 2012, the total volume of the Chinese economy exceeded 50 trillion yuan, and even with 8 percent GDP growth, the increase will be 4 trillion yuan,” said Mo Rong. “And with an economic volume of 40 trillion yuan, to achieve an increase of 4 trillion 10% GDP growth is needed."
As the economy expands, even as growth slows, employment growth will remain stable.
Deputy Minister of Human Resources and Social Security Xin Changxing emphasized that optimizing the economic structure has also expanded employment opportunities. In terms of industry structure, the greatest employment potential is in the service sector. In the third quarter of this year, this sector of the Chinese economy grew by 8.4 percent compared to the same period last year, exceeding the growth rates of agriculture, industry and GDP. The total value added of the service sector also exceeded the industrial sector, which actively stimulated employment.
In addition, the beginning this year of decentralization of the government system, reducing government intervention in the economy and other reforms contributed to the rapid development of the private sector of the economy with an increase in employment. In the first half of the year, 985.3 thousand new private enterprises were registered (an increase of 8.59 percent compared to the same period last year). The number of individual commercial and industrial enterprises registered in the first 6 months of this year reached 3 million 895.8 thousand (an increase of 7.26 percent compared to the same period last year). Thanks to this, a large number of jobs were created.
Xin Changxing said that the coordinated development of regional economies also helps to increase employment. As for the regional structure, in the eastern region, the most developed in terms of employment, the economy was quite stable. The employment rate in cities here increased by 5 percent compared to the same period last year. Employment growth in the western and central regions of the country, although slowing, still increased compared to last year by 1 and 6 percent, respectively.
“Structural contradictions are the main problem of employment in China,” said Mo Rong. “This has become especially noticeable this year: students are not able to find work, and enterprises are unable to find qualified workers.”
According to experts, in recent years, structural contradictions have led to the fact that graduates of some specialties are faced with an oversaturation of the market; supply has exceeded demand. This may result in a reduction in wages.
The oversaturation of the Chinese labor market with labor is another existing problem. Xin Changxing said that since 2012, the working-age population has decreased by more than 3 million, but this is just the beginning of a decline after reaching a peak. The labor force is still large. By around 2030, the labor force is projected to reach a steady level of more than 800 million people.
According to experts, China already has some experience in providing jobs for those fired from state-owned enterprises, and at the moment the main task should be to solve the problem of employing students.
Yin Chengji said that currently the main focus of the Ministry of Human Resources and Social Security is to provide employment services for unemployed university graduates, register university graduates who want to find a job, and provide counseling.
He also noted that next year the employment of university graduates will continue to remain a priority task of the Ministry.
At the same time, Mo Rong drew attention to the fact that in order to regulate the employment structure, it is necessary first of all to develop strategically important new industries, create new opportunities for employment growth, intensively develop advanced manufacturing industries and production using new high technologies, and create a modern sphere services, modern agriculture, etc., develop employment programs more suitable for young people, especially for university graduates.
On the other hand, it is necessary to develop a system of professional training and review the personnel structure. Currently, the demand for students from vocational academies and technical schools is very high, so enterprises have to “book” specialists during their training. This indicates that enterprises need a large number of qualified personnel, which means that it is necessary to create more vocational schools and train more qualified personnel. -0-
Currently, China has many unemployed people in both rural and urban areas. As a result of the increase in life expectancy of the population and the implementation of strict government policies to limit the birth rate in China, the proportion of the elderly population (65 years and older) has increased: it exceeds 7%. On average, for every person of working age there is one disabled person, i.e. younger or older than working age.
In 2001, 63.91% of the population lived in rural China, and 36.09% in urban areas. Agriculture's share of China's GDP was 15.23%, while it still employed 50% of the workforce.
It should be especially noted that currently in China, 125 million people are employed in rural enterprises, and approximately 60-80 million peasants constantly work in cities, but according to statistics they belong to the rural population. Opportunities for the resettlement of peasants to cities are limited.
Before the start of the reform (1978), the replenishment of the labor force in cities relied almost entirely on graduates of higher educational institutions, demobilized and retrained military personnel. In agriculture, in accordance with the strategic line of “bread production as the main link of the economy,” peasants did not have a free choice of work and independent farming. As the population increased, the area of arable land per capita decreased. Over the course of 26 years (from 1952 to 1978), the share of those employed in agriculture in the total number of employed decreased from 83.5% to 70.5%.
During China's reform, two policies were introduced that had a major impact on rural employment in the country. Firstly, peasants were allowed to freely choose professions and independently conduct economic activities; secondly, peasants were allowed to do business in cities. The first measure led to the employment of 125 million workers in enterprises in rural areas. The second is the movement of approximately 60-80 million peasants from rural areas to cities. Over the course of 23 years (from 1978 to 2001), the share of those employed in agriculture in the total number of employed decreased from 70.5% to 50.0%.
State-owned enterprises in cities began to implement a policy to reduce the number of employees in order to increase business efficiency. Thus, the reforms led to the rapid formation of a labor market in both urban and rural areas. At the same time, people who have urban registration and have higher demands on the nature of their future work almost do not turn to the rural market. And in the urban market (with the exception of a few small coastal towns), people with rural registration can only rarely find work.
The labor market in cities is also divided into two sectors: state and non-state. Although in China these sectors of the labor market have some common features, there is no unified wage system, personnel selection system, or social security system. There are differences in the relationship between labor demand and supply. In this regard, policies aimed at regulating supply and demand in the labor market in some cases do not bring positive results, and sometimes even have a negative effect. For example, to ensure that laid-off workers at state-owned enterprises have a better chance of finding employment, some cities have taken measures to limit the migration of peasants to the cities; however, former employees of state-owned enterprises preferred unemployment to employment in more difficult and lower-paid jobs, etc. Measures to limit the employment of peasants in cities did not ease the situation with the employment of laid-off employees of state-owned enterprises, but, on the contrary, led to the fact that in some places there was even a shortage of labor supply.
The impact of the economic slowdown on employment. Typically, employment growth is proportional to economic growth. From the point of view of future development trends, the rate of economic growth in China will slow down. One of the reasons for this is the increase in the basic value of GDP. For example, in 1980, the basic value of GDP was 451.8 billion yuan. Its increase by several tens of billions of yuan resulted in 10% economic growth. In 1990, China's GDP was 1859.8 billion yuan, i.e. to increase it by 10%, an increase of 200 billion yuan was required. And in 2000, GDP reached 8940.4 billion yuan, and its increase by 10% requires an increase in GDP in absolute terms of 900 billion yuan. The second reason for the slowdown in economic growth is the transition from a deficit economy to a surplus economy. This reason forced China to abandon the previous development model, which was characterized by “expansion of production and extensive management,” and move to a development model that ensures the quality and efficiency of growth.
Currently, China is moving from high rates of economic growth to medium rates of development, at which 8% economic growth is already considered high. This is confirmed by examples of industrial countries. Thus, for 20 years (from 1953 to 1973), the average annual GDP growth rate in the Republic of Korea was 7.5%, in Hong Kong - 8.0%, in Taiwan - 8.2%, in Singapore (1960-1973) - 9.3%; in the highest phase of economic takeoff from 1970 to 1980, the average annual GDP growth rate in Korea was 10.1%, in Hong Kong - 9.2%, in Taiwan - 10.1% (1970-1981); from 1980 to 1993 in the Republic of Korea - 9.1%, in Hong Kong - 6.5%, in Singapore - 6.9%.
In China, from 1981 to 1990, the average annual GDP growth was 9.3%; from 1991 to 2000 - 9.9%, while the average annual increase in the number of employed was 1.03%, i.e. on average, more than 7 million new jobs were added each year. Over the next 10 years, the number of jobs is expected to increase by an average of only 6 million each year, based on 8% GDP growth. Essentially, this is an optimistic forecast.
The impact of regulation of industry structure and technology upgrading on employment. Industrialization led to the replacement of manual labor with technology.
However, one cannot conclude that “the greater the contribution of technology and capital to economic growth, the worse the situation in the field of unemployment,” based on the advantage of replacing labor with capital and technology. The features of the “catch-up economy” and the “fragmented labor market” in China led to the fact that “negative factors” became predominant, especially in the second half of the 90s of the 20th century, when the labor force moved from agriculture to the non-agricultural sector. But industry no longer attracts new labor; it is becoming saturated and jobs are being cut. The service sector, which is characterized by low growth rates, has difficulty accommodating the additional labor coming from agriculture and industry.
In fact, in the early 80s of the 20th century, China already showed a tendency towards a decrease in the coefficient of elasticity of employment in relation to economic growth and capital investment. From 1981 to 1990, the average annual growth rate of GDP was 9.3%, the average annual growth rate of total investment in fixed assets was 18.1%, the average annual growth rate of employment was 3%, the elasticity of employment with respect to GDP was 0.32, and the elasticity of employment in relation to investment is 0.16. From 1991 to 2000, GDP increased by an average of 9.9% each year, the value of total investment in fixed assets increased by an average of 22.9% each year, and the number of people employed increased by an average of only 1.03% each year, elasticity employment in relation to GDP decreased to 0.10, the elasticity of employment in relation to investment decreased to 0.04.
The impact of increased labor supply on employment. Although currently the birth rate in China has already decreased to 15.23% (1999), approaching the level of many developed countries of the world, the total population, including the working-age population, still tends to increase. The working age population (men - from 16 to 59 years old; women - from 16 to 54 years old) in 1995 was 731 million people, in 2000 - 888 million people, in 2010 it will increase to 910 million people , and in 2016 it will reach its maximum value - 950 million people. A decrease in the birth rate in the coming years will affect the decrease in the working-age population only after 2016; Only by 2030 will the working age population match the level of 2000.
In 2003, excess labor supply in China's cities will be even higher than in the previous few years. GDP growth in 2003 will be 7-8%.
In cities, the number of new jobs will increase by approximately 4-6 million; In addition, about 3 million places will be released due to the retirement of workers. Thus, the total number of new jobs will be approximately 7-9 million. However, in 2003, the increase in the urban population of working age will be approximately 10 million, i.e. the number of new unemployed in 2003 will be 5-6 million people (the number of unemployed at the end of 2002 was 1.29 million people). The total number of jobs needed will be about 20 million. Ultimately, the surplus labor force in China in 2003 in cities alone will reach 11-13 million people.
The main job search channels and preferred professions when searching for a job. In China's former planned economy, jobs for urban residents were provided primarily by government organizations and enterprises. As economic reform deepens, the channels through which job searches are carried out have become more diverse. However, the public employment support network is still imperfect. This is especially true for public support for the employment of the unemployed. China lacks experience and has not established an effective formal public employment support network. When looking for a new job, in most cases you have to rely on the help of relatives and friends, i.e. to an unofficial public network. According to a sample survey of unemployed people and their families, which was conducted by the Beijing Socio-Economic Problems Research Group in June 1999, in the job search process, 50.3% of the unemployed relied on recommendations from relatives, friends and other structures of informal public organizations; 22.3% turned to professional employment agencies, centers for promoting capable people, advertising employers, etc.; 10.8% relied on recommendations and assistance from previous organizations; 9.9% contacted the administrative committee of the street and local government network; only 2.3% looked for work through the Reemployment Service Center and 4.4% through other channels. This phenomenon does not only exist in Beijing. A survey of the unemployed, conducted by scientists in 4 old districts of Guangzhou in Guangdong Province, showed that in the process of finding employment, 47.9% of the unemployed relied on the help of relatives, friends and other informal structures. Job searches through professional employment agencies, labor markets and employer advertisements were carried out by 17.2%. 25.4% looked for work through previous organizations, and 9.5% through street administrative committees and the local government network.
The important role that connections with family and friends play in the job search process may be explained by China's social structure and traditional culture, which is based on the family. But the instability of market channels and the lack of a formal employment system during the transition to a market economy can play a decisive role. For most unemployed people, finding work through relatives and friends is the cheapest way to find employment.
However, the social network that is formed through connections with relatives and friends is not always effective for all unemployed people. According to the results of a survey conducted in Wuhan, the social status of relatives and friends of unemployed people has an obvious positive impact on their use of the social network in searching for work. But the role of relatives and friends in the process of finding employment for the unemployed is limited. This role in most cases only increased the unemployed's chances of getting a job. The main factors that influenced the type of work received were still the qualitative indicators of the workforce, i.e. level of education, professional skills, etc.
In terms of preferences, the majority of unemployed people intend to work in the public sector, which has a relatively developed social security system; in the non-state sector the level of social security is lower. However, almost half of the jobs that the unemployed consider suitable for themselves were transferred to the non-state sector during the reform. According to a sample survey of unemployed people and their families, which was conducted by the Beijing Social and Economic Problems Study Group in June 1999, the proportion of unemployed people intending to work: 1) in the public sector was 67.6%; 2) at collective enterprises - 12.2%; 3) in the field of individual entrepreneurship - 10%; 4) at enterprises with tripartite investments - 5.4%; 5) at private or individual enterprises - 4.4%. But the real picture of re-employment was this: the proportion of unemployed people who found work in the public sector was 33.1%; at collective enterprises - 15.6%; in individual entrepreneurship - 20.3%; at private or individual enterprises - 18.2%; at enterprises with tripartite investments - 5.7%. 71.4% of the unemployed believed that the most suitable professions for them were a salesperson, a waiter, a simple clerk, a cleaner at enterprises, a driver, etc.
The market principle and the principle of social stability. Unemployment is an inevitable consequence of market reform. In order for state-owned enterprises to be able to develop stably in conditions of increasing market competition every day, it is necessary to reduce workers and increase labor efficiency. However, layoffs bring problems not only to employees, but also to society. In the past, for a long time, state-owned enterprises were responsible for employment and stability in society. The ongoing transformation of state-owned enterprises in China is to gradually remove social functions from state-owned enterprises and transfer them to special social security agencies. However, the process is very slow. An analysis of the survey materials showed that, on the one hand, at the enterprise level, when dismissing workers, the market principle has to be observed. At weak enterprises that cannot pay off accounts receivable, where production has been completely or partially suspended, or where ownership reform is underway, the number of laid-off workers is larger. There is very little chance for them to continue working at their previous enterprises. Sometimes businesses close down completely and everyone is laid off.
On the other hand, within enterprises it is necessary to respect the principle of social stability and continue to take into account the interests of workers. At many enterprises, certain categories of workers were identified, for which they were not included in the lists for reduction. For example, it is impossible to dismiss men over 55 years of age and women over 50 years of age, members of military families; Only one of the working spouses can be laid off, etc. In practice, older and sick employed people were in most cases advised to “retire early” and “retire on disability”. Great care was shown for workers who have family difficulties or are not competitive in the labor market.
The current state of state-owned enterprises is a key factor determining the form of layoffs. In state-owned enterprises, where workers are better provided for, their interests remain taken care of. In order to stabilize enterprises and society, such forms of dismissal as “full employment of laid-off workers”, “solving the problem of laid-off workers within enterprises”, “dismissal with payment of monetary compensation”, etc. are preferred. And at enterprises where the financial situation has deteriorated and there are no funds to maintain the well-being of workers, dismissal on a market basis becomes a necessary measure. In this case, unemployed people who are competitive (young, have professional skills, have extensive connections, etc.) can solve the problem of employment outside their previous enterprise.
Potential volume of demand in the Chinese labor market. Based on the indicators that characterize the demand for labor, the tense employment situation may persist for a long period. And this situation must be taken into account.
Among the factors determining the growth of demand for labor, the first is the indicator of economic growth, the second is the indicator of changes in the socio-economic structure. Based on economic growth indicators (calculated using an average annual GDP growth rate of 7% and an employment elasticity coefficient of 0.13), about 6.5 million jobs will be created annually from 2000 to 2005, which is not will be satisfied with the additional supply on the labor market, which averages 8 million people per year. On the other hand, based on indicators of changes in the socio-economic structure, the potential for increasing demand for labor is still great.
Employment elasticity coefficients in individual industries differ significantly. Since the 1990s, due to the decline in the absolute number of workers in agriculture, the coefficient of employment elasticity with respect to agricultural growth has always been negative; the coefficient of elasticity of employment with respect to industrial growth was in the range between 0.12 and 0.16; and the coefficient of employment elasticity with respect to service sector growth averaged 0.75. Currently, in China, the share of workers in the service sector is less than 30% (in developing countries - on average about 40%, in India - 55%; in developed countries - on average 70%, in the USA - 80%). If China's service sector employment rate were equal to the developing world average, it would create about 90 million jobs.
Currently, the proportion of the urban population in China is about 35%, while in other countries the figure is around 60% (and in some countries even more than 80%). The expected increase in the level of urbanization in China to 45% will make it possible to create several tens of millions of jobs in cities within five years (2001-2005).
In addition, stimulating the development of non-state enterprises also helps to increase the potential for labor demand. Most non-state enterprises are medium or small. They have diverse employment channels, flexible employment options and relatively low hiring requirements. These characteristics are especially significant for attracting labor. Over the next few years, more than 95% of new job growth in China will come from economic development in the private sector. A special place in this process will belong to such a rapidly developing industry as the information industry.
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