ExplainerChina jobs: workforce, unemployment and retirement age explained
- China has a workforce of close to 900 million people, of which 350 million are migrant workers and some 9 million are new graduates this year
- China’s workforce, though, is expected to decline due to an ageing population, with Beijing set to raise the retirement age
This is the first in a series of stories on China’s job market, looking at its history, the role of migrant workers, inequality and the future for its graduates entering the workforce.
China provides an official surveyed unemployment rate for urban workers, although it is seen by some as being unrepresentative of the overall employment situation, as it does not include most of China’s self-employed business owners and migrant workers.
How big is China’s workforce?
The National Bureau of Statistics (NBS) said in June 2021 that around 14 million people were expected to enter the urban workforce in 2021, of which 9.09 million are graduates.
China has also set a full-year target to add more than 11 million urban jobs in 2021.
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Experts have long warned that Beijing must take action against a declining labour force and rapidly ageing society, which is expected to weigh on the country’s economic progress in the years ahead.
What is China’s level of unemployment?
The official surveyed unemployment rate for urban workers in China rose sharply in the wake of the coronavirus pandemic, touching a nearly two-decade high of 6.2 per cent in February 2020. Since then, the figure has gradually retreated to near its pre-pandemic level.
The official surveyed unemployment rate for urban workers, though, is seen by some as unreliable, as China’s 149 million self-employed business owners and nearly 300 million migrant workers are not included.
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No government data set offers a clear picture of the job market, and most economists believe official figures underestimate joblessness.
Unlike developed economies, which typically offer a broad range of employment indicators, China has historically relied on two figures for unemployment data – both of which have shortcomings.
Before 2018, Beijing published data on how many urban workers registered with the government when they lost their jobs. Data from local authorities excluded migrant workers who were not born in the city in which they worked and so were ineligible for social benefits. To be counted as unemployed, people also had to be between the ages of 16 and 59.
The data was detached from the reality of the overall labour market, particularly during the global financial crisis of 2008-09, when more than 20 million migrant workers became unemployed but the headline jobless rate barely moved.
Since 2018, China has used a monthly survey-based unemployment rate as its main indicator. The data captures all regular urban residents, does not include an upper age limit, and the NBS claims it also includes migrant workers, although this is disputed by some analysts.
To be considered unemployed, a worker needs to have been actively looking for a job in the past three months and be able to start work within two weeks; otherwise, he or she is not counted as employed or unemployed.
What is the retirement age in China?
But at the National People’s Congress in Beijing in March 2021, Premier Li Keqiang confirmed in the government’s work report that “the statutory retirement age will be raised in a phased manner”.
Workers unhappy about China’s plan to change decades-old retirement age rules
The proposal sparked uproar on social media after it was announced, with critics saying it was unfair to make them work longer than expected because China’s shrinking labour force was the result of government policies.
“For example, in the first year of the implementation of this policy, women who originally would retire at the age of 50 will retire at the age of 50 plus one or more months. The retirement age will vary for different age groups. That is to say, there will be a number of years of transition,” Jin told the Xinhua News Agency.