Thursday, 20 November 2008

China’s Job Outlook Grim


China warned on Thursday it was facing major unemployment problems due to the global economic crisis, as it unveiled a series of measures aimed at maintaining and creating jobs.

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China’s Job Outlook Grim

AFP
20 November 2008

BEIJING - China warned on Thursday it was facing major unemployment problems due to the global economic crisis, as it unveiled a series of measures aimed at maintaining and creating jobs.

‘Currently, the employment situation is critical, and this impact (of the financial crisis) is still unfolding,’ Yin Weimin, China’s social security minister, told reporters in response to a question on recent labour unrest.

‘We have called on all levels...to place priority on the stabilisation of the employment situation.’

Mr. Yin announced a series of measures to try and stave off unemployment and to help those that have lost their jobs, particularly among China’s 230 million rural workers.

He warned that the impact of the global economic turndown would be felt the hardest in the first quarter of 2009.

‘Up until now, there have been no large-scale layoffs or any wave of rural migrant workers returning home,’ Mr. Yin said.

‘(But) the number of rural migrant workers returning home is gradually increasing so we are watching this very closely.’

With up to 24 million people seeking jobs in China every year, the government was hard pressed to fulfill its goal of seeing the creation of 12 million new jobs annually, he added.

Mr. Yin said joblessness had been most acute in China’s coastal provinces, the nation’s export-oriented manufacturing heartland, as light industry and textile companies closed, went bankrupt or stopped work.

Thousands of workers in those regions have already gathered in recent weeks outside shuttered factories, demanding unpaid wages.

Zhang Xiaojian, vice minister of social security, said China’s unemployment rate stood at four per cent, and that the government expected to remain within its target of 4.5 percent by the end of the year.

‘But next year the registered (official) unemployment rate will certainly increase,’ Mr. Zhang said.

The national rate is also a vast underestimate because it does not include the 230 million rural workers.

Mr. Yin said a new system to incorporate them into the nation’s overall employment picture was currently on the drawing board.

Mr. Zhang also warned the government would face difficulties in finding employment for the nation’s educated youth, with over six million expected to graduate from college next year.

‘If the job demand at enterprises falls, then the job situation for graduates will be very tight,’ Mr. Zhang said.

Taking steps to quell social tensions
China meanwhile announced measures on Thursday aimed at absorbing job losses and staving off civil unrest, amid rising concerns the economic crisis was fuelling long-simmering social tensions across the country.

The policies cover a wide range of areas, such as raising compensation for farmers kicked off their land, helping laid-off workers, ensuring police handle protests correctly and clearing a backlog of sensitive court cases.

‘The campaign will help to ease social conflicts, protect the people’s legal interests and maintain social stability,’ Zhou Yongkang, China’s top law enforcer, said in detailing the eight-month programme to clear the court cases.

China’s Communist Party has long been obsessed with social stability, concerned that any type of protest could escalate into a major challenge to its 59-year rule.

With China’s economy slowing, a series of high-profile protests have erupted recently over job losses and long-standing grievances over the many injustices in Chinese society such as powerful interests taking people’s land.

Public Security Minister Meng Jianzhu warned police chiefs they ‘should be aware of the challenge brought by the global financial crisis and try their best to maintain social stability’, the official China Daily reported.

Highlighting the concerns, thousands of people took to the streets this week in northwest China’s Gansu province wielding axes, chains and other weapons to confront authorities over a typical ‘land grab’ dispute.

Meanwhile, tensions remain high in southern Guangdong province, China’s manufacturing heartland, where thousands of manufacturing workers have gathered in recent weeks outside closed-down factories to demand unpaid wages.

Social Security Minister Yin Weimin admitted that an expected spike in unemployment was a serious concern for the government.

‘We have called on all levels of the human resources and social security ministry to... place priority on the stabilisation of the employment situation as the top task that we must tackle,’ Mr. Yin told reporters.

He announced a series of measures to try to stave off unemployment and to help those who have lost their jobs, particularly among the 230 million rural migrant workers who form the backbone of China’s struggling export industry.

Mr. Yin said measures included helping migrants find a job when they come to urban areas and providing extra training for those returning home.

A four trillion yuan (S$894 billion) three-year economic stimulus package announced earlier this month by the central government would also aid in creating jobs, he said.

The ministry of land and resources, meanwhile, announced it would increase compensation for farmers’ land from 2009 ‘to guarantee the lawful rights of farmers whose land has been taken”, in a statement on its website on Thursday.

Government-backed ‘land grabs’ are a common occurrence in China and have sometimes fuelled violent protests as owners of the properties are forcibly moved away to make way for new developments.

These issues were the backdrop to this week’s two-day riot in Longnan, Gansu province, which left 60 people injured.

The ‘land grab’ issue was also being addressed as part of the campaign to clear the sensitive court cases announced by Mr. Zhou via the official Xinhua news agency.

Six types of court cases were listed as priorities to be fast-tracked, including those linked to land disputes, others delayed due to local government interference and ones involving migrant worker payments, Xinhua reported.