OECD Economics Department Working Papers

ISSN :
1815-1973 (online)
DOI :
10.1787/18151973
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Working papers from the Economics Department of the OECD that cover the full range of the Department’s work including the economic situation, policy analysis and projections; fiscal policy, public expenditure and taxation; and structural issues including ageing, growth and productivity, migration, environment, human capital, housing, trade and investment, labour markets, regulatory reform, competition, health, and other issues.
 

China's Labour Market in Transition

Job Creation, Migration and Regulation You or your institution have access to this content

Authors:
Richard Herd1, Vincent Koen1, Anders Reutersward
Author Affiliations
  • 1: OECD, France

Publication Date
01 Feb 2010
Bibliographic information
No.:
749
Pages
42
DOI
10.1787/5kmlh5010gg7-en

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Over the past decade, the share of jobs not controlled by the state has increased considerably, whilst employment in agriculture has declined, against the backdrop of ongoing urbanisation. Over 200 million people have been drawn into urban areas through official or unofficial migration, despite various obstacles to labour mobility, including the registration system and the associated restrictions to social service access. New labour laws were introduced in 2008 to better protect employees in a market now dominated by private-sector employers, notably via more systematic use of and adherence to written labour contracts, in particular of indefinite duration ones. To what extent the new legislation and implementing regulations will be enforced remains to be seen. For the time being, de facto employment protection is far less than de jure, with an enduring preponderance of fixed-term contracts, involving few restrictions. Minimum wages are set locally and have not kept up with average wages, nor are they effectively enforced. During the recent slowdown, average wages adjusted rapidly and employment was soon on the rise again. However, this episode also highlighted the need to integrate migrants better, not least by relaxing registration rules.
Keywords:
China, unemployment, social services, urbanisation, minimum wage, contracts, labour market, employment, hukou, access
JEL Classification:
  • E24: Macroeconomics and Monetary Economics / Macroeconomics: Consumption, Saving, Production, Employment, and Investment / Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital
  • J21: Labor and Demographic Economics / Demand and Supply of Labor / Labor Force and Employment, Size, and Structure
  • J23: Labor and Demographic Economics / Demand and Supply of Labor / Labor Demand
  • J24: Labor and Demographic Economics / Demand and Supply of Labor / Human Capital; Skills; Occupational Choice; Labor Productivity
  • J31: Labor and Demographic Economics / Wages, Compensation, and Labor Costs / Wage Level and Structure; Wage Differentials
  • J41: Labor and Demographic Economics / Particular Labor Markets / Labor Contracts
  • J42: Labor and Demographic Economics / Particular Labor Markets / Monopsony; Segmented Labor Markets
  • J61: Labor and Demographic Economics / Mobility, Unemployment, and Vacancies / Geographic Labor Mobility; Immigrant Workers
  • J63: Labor and Demographic Economics / Mobility, Unemployment, and Vacancies / Turnover; Vacancies; Layoffs
  • J65: Labor and Demographic Economics / Mobility, Unemployment, and Vacancies / Unemployment Insurance; Severance Pay; Plant Closings
  • J71: Labor and Demographic Economics / Labor Discrimination / Discrimination
  • J82: Labor and Demographic Economics / Labor Standards: National and International / Labor Force Composition
  • J83: Labor and Demographic Economics / Labor Standards: National and International / Workers' Rights
  • K31: Law and Economics / Other Substantive Areas of Law / Labor Law
  • O53: Economic Development, Technological Change, and Growth / Economywide Country Studies / Asia including Middle East
  • P23: Economic Systems / Socialist Systems and Transitional Economies / Factor and Product Markets; Industry Studies; Population
  • R23: Urban, Rural, and Regional Economics / Household Analysis / Regional Migration; Regional Labor Markets; Population; Neighborhood Characteristics