The reform of the PRC employment system and unemployment in urban China : evidence from cross region analysis

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The reform of the PRC employment system and unemployment in urban China : evidence from cross region analysis

 

Author: So, Mo-yu Suanne
Title: The reform of the PRC employment system and unemployment in urban China : evidence from cross region analysis
Year: 1999
Subject: Unemployment -- China
Manpower policy -- China
China -- Economic conditions -- 1976-2000
Hong Kong Polytechnic University -- Dissertations
Department: Multi-disciplinary Studies
Dept. of Business Studies
Pages: 86, [23] leaves : ill. (some col.) ; 30 cm
Language: English
InnoPac Record: http://library.polyu.edu.hk/record=b1484307
URI: http://theses.lib.polyu.edu.hk/handle/200/774
Abstract: Similar to other European countries undergoing economic transition, there was a drastic drop in the level of employment when the PRC vigorously introduced market mechanism into state owned enterprises and the labour system in the 1990s. The registered unemployment climbed to 4% in 1998. Regardless this percentage seems to be quite low compared with other S.E. Asian developing countries, this percentage represents a huge magnitude of unemployed as over 17 million people. In fact, the real unemployment rate is far more striking if surplus labour and disguised unemployment is included. During the recent unemployment crisis, the labour system indeed is undergoing several significant changes in various aspects. The government begins to fully implement the contract employment system to phase out the life employment system. The control over labour mobility and wages system is gradually relaxed especially for the latter. There is a flow of labour from primary to tertiary industry as well as from state sector to private sector. Nevertheless, the outlook is not optimistic. It is generally believed that the unemployment rate will not be reduced in a very short period of time until the economic reform is fully accomplished. While unemployment crisis is a national issue, a number of researches reveal that the differences in regional economies within a transition country affect the level of unemployment across regions. This can be explained that the regional disparities will be translated into the differences in regional performance and adaptability towards economic reform. These differences include variation in economic structure, economic performance, degree of matching between job and labour, wages level. Based on the studies on transition countries, a model is developed to identify the determinants of regional urban unemployment rate in the PRC. The determinants include industrial diversification, outputs growth, ratio of employment in private sector, education level of labour and wages level. A regression analysis is deployed to examine the validity of the model. The analysis results are quite satisfactory in terms of the low error and three determinants are identified to be significantly associated with regional urban unemployment rate.

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