Report on Urban Unemployment in China·2011
I. Overall Urban Unemployment Rate in China
The overall urban unemployment rate in China is 8.0% in 2011. Specifically, the unemployment rate of men is 8.1% and that of women is 7.8%[1][2]. According to the data of Sixth Nationwide Population Census in 2010 implemented by National Bureau of Statistics, the urban labor force population totaled 346,240,000 in 2010[3]. Therefore, it is inferred that the total unemployment of China exceeds 27,700,000 people in 2011[4].
II. Distribution of Urban Unemployment in China[5]
1.Unemployment Rate in West Region Obviously Higher Than That in Central and East Regions
CHFS data shows that the urban unemployment rate in China is characterized by regional difference. The unemployment rate in east, central and west regions is 6.9%, 8.3% and 14.1% respectively, with a big difference between the east and west regions. The unemployment rate in the west region is obviously higher than that in the central and east regions.
Fig. 1 Region Distribution of Urban Unemployment Rate in China
2.The Unemployment Rate of Workers with Secondary Education Level Is Relatively High
The unemployment rate in the US decreases monotonically with the education level[6], while that in China shows an inverted U shape. The unemployment rate of urban workers with junior high education level is 11.2%, ranking the highest. The urban workers with senior high or professional high education level follow with unemployment rate of 11.0%. However, as for workers with primary school education level or below, the unemployment rate is relatively lower, only 4.9%. Moreover, higher education obviously reduces the unemployment. The unemployment rate of workers with junior college degree is only 4.1%, far lower than that of workers with junior or senior high education level. The employment rate of urban workers with bachelor degree or above is the lowest, only 2.8%.
Fig. 2 Education Distribution of Urban Unemployment Rate in China
3.The Unemployment Rate of Workers Less than 26 Years Old and More than 46Years Old Is relatively High
The age distribution of urban unemployment rate in China shows an obvious inverted U shape. The unemployment rate of workers at age of 21-25 reaches up to 9.6%. After that, as the age increases, the unemployment rate of workers gradually decreases. As for workers at the age of 26-40, the unemployment rate reaches the low point of about 5.5%, and then tends to be stable. After 40, as the age increases, the unemployment rate of workers ascends again. At the age of 46-50, the unemployment rate ascends to 9.3%, nearly 2 times higher. However, the unemployment rate of workers in the US tends to decrease monotonically with the age, with that of young workers reaching the peak, and as the age increases, the unemployment rate gradually descends[7].
Fig. 3 Age Distribution of Urban Unemployment Rate of Workers in China[8]
III.Analysis of the Age Group of High Urban Unemployment Rate in China
Fig. 3 shows that the urban unemployment rate in China is higher in the first and last age groups. To understand the structure of such high unemployment rate groups, the high unemployment groups at the age of 21-25 and over 46 are further analyzed as follows.
1.College Graduates Face Severe Employment Conditions
Unlike the overall tendency, education does not reduce the unemployment rate of young workers. CHFS data shows that as with higher education level, the unemployment rate of young workers at the age of 21-25 gradually increases. The unemployment rate of young workers with primary school education or below is only 4.2%, while that with junior high and senior high education is about 8%. The unemployment rate of young workers with low and medium education is lower than the average level, which reflects the “labor shortage”, especially the current short supply of young ordinary workers. On the other hand, the unemployment rate of young workers with junior high education increases to 11.3%, and that with college education further increases to 16.4%, which is far greater than the average level. Therefore, employment difficulty of college students is the main reason for such high unemployment rate of young workers.
Fig. 4 Education Distribution of Urban Unemployment Rate of Workers at the Age of 21-25
2.Higher Education Facilitates the Employment of the Middle Aged
The high unemployment rate of workers at the age of 46-50 is mainly reflected by high unemployment rate of worker groups with junior high, senior high and professional high school education. The unemployment rate of workers with junior high education is up to 13.0%, while that with senior high and professional high school education reaches 11.9%. With higher education, the unemployment rate decreases greatly. The unemployment rate of workers with junior college education decreases to 2.0%, while that with bachelor degree or above drops to 0.9%.
Fig. 5 Education Distribution of Urban Unemployment Rate of Workers at the Age of 46-50
3.The Retirement Policy Results in the Unemployment Rate of Aged Men Much Higher than Women.
Fig. 3 shows that at the different stages of life cycle, the unemployment rate of men workers is lower than that of women. However, as for the age over 50, the unemployment rate of men workers ascends greatly, which is far more than that of women. Considering the age of workers up to 60, it is obvious that the unemployment rate of women at the age of 51-55 is 8 percent points less than that of men, and that the unemployment rate of women workers at the age of 56-60 is less than half the unemployment rate of men. As for gender distribution, men workers account for 78.1% of the unemployment group at the age of 51-55, and 83.1% of the unemployment group at the age of 55-60.
Table 1 The Unemployment Rate of Aged Men and Women Workers
51-55 / 56-60Men / 19.0% / 16.6%
Women / 11.0% / 7.1%
The difference of unemployment rate between the aged men and women workers is resulted from the retirement policy for men and women. Due to the retirement policy, the aged men workers cannot retire from the labor market as the aged women at the same age stage, and have to undertake the pressure of unemployment. This is proved by the sharp drop of the unemployment rate and working population of women at the age of 51-55 and 56-60[9].
Table 2 Proportion of Aged Men and Women Workers
51-55 / 56-60Men / 85.1% / 65.2%
Women / 40.0% / 27.2%
4.The High Unemployment Rate of Aged Workers is a Historical Phenomenon of Laid-off Wave.
The data shows that the unemployment rate of workers at the age of 51-55 reaches up to 16.4%. According to the analysis of the above, the high unemployment rate of aged workers is mainly resulted from the severe unemployment of aged men workers. When it comes to the unemployment rate of men workers only, the unemployment rate of the aged workers will further ascend up to 18.7%.
Some reasons for such high unemployment rate can be dated back to the “laid-off wave” burst out in 1998[10]. Since most of the laid-off workers are of urban household, the soaring unemployment rate arising from laid-off wave must widen the gap of unemployment rate between the urban resident workers and the rural population[11]. CHFS data shows that the unemployment rate of men workers from rural areas at the age over 50 is 32%, which is almost the same as the overall unemployment rate of men workers from rural areas; however, the unemployment rate of men workers from urban households is rocketed to 27.5%, which is twice as much as the overall unemployment rate (11.3%) of the men workers from urban households, and much more than that of men workers from rural areas at the same age. The difficulty of “re-employment of laid-off workers”, to some extent, increases the unemployment rate of the aged men workers.
Table 3 The Unemployment Rate of Men Workers at Different Age Stages
21-30 / 31-40 / 41-50 / 51-60 / OverallUrban household / 10.0% / 7.1% / 10.9% / 27.5% / 11.3%
Migrant workers / 3.7% / 3.2% / 1.7% / 3.2% / 2.9%
IV.The Unemployment Rate of Migrant Workers – the Status Quo and Future of “Migrant Worker Shortage”
According to CHFS data, the migrant workers account for 40.9% of the total urban working population. Therefore, it is estimated that the total population of migrant workers in cities is about 141,540,000 people.
1.The Unemployment Rate of Rural Population is Much Lower than That of Urban Resident Workers
In general, the unemployment rate of migrant workers is only 3.4%, which is much lower than that of urban resident workers. And the latter reaches up to 11.2%. As for different regions, the unemployment rate of migrant workers in the east region is the lowest, only 2.8%, followed by the central region, and that in the west region is the highest, but only 5.3%. However, the unemployment rate of urban resident workers in different regions is relatively high, and that in the west region is the highest, reaching up to 17.5%.
Fig. 6 Region Distribution of the Unemployment Rate of Urban Households and Migrant Workers
2.The Change of Unemployment Rate of Migrant Workers Is not Obvious with Age.
According to the age groups, the unemployment rate of migrant workers does not show the similar U shape of the overall unemployment rate. Due to the lack of experience, the young workers from rural areas at the age of 21-25 have a relatively high unemployment rate of 4.7%, while that of rural workers over 26 is stabilized at a level less than 3%. The unemployment rate of rural workers at the age of 26-35 is the lowest, with only 2.5%.
Fig. 7 Age Distribution of the Unemployment Rate of ExternalRural Population
3.Supply Shortage of Subsequent Workforce of rural areas: “shortage of migrant workers” will be present for a long period
Part of the rural population staying in the rural areas are employed by others or unit or self-employed. Therefore, irrespective of such part of work force, the existing work force in rural areas accounts for about 33.5% of the rural population[12]. According to the statistics of NBSC, the rural population in China totaled 934,710,000 people in 2010. Therefore, it is estimated that the rural work force in China totals about 312,660,000 people in China.
Fig. 8 Work Force Structure of Rural Population by Age
Fig. 8 shows that nearly half of the rural work force at the age of 16-25 flows into cities, and the rest is only 16.4%. Likewise, as for the rural work force at the age of 26-35, 42.3% of them seek for jobs in cities, and only 21.1% remains as farmers. As for the middle-aged and elderly rural workers over 36, the situation is obviously different for the vast majority of them are staying in countryside for agricultural production. As for rural work force at the age of 46-55, there are 52.3% population staying in the village for agricultural production, only 29.6% seeking for jobs in cities, and 17.4% being employed by others or unit. On the one hand, this shows a serious “empty nest” phenomenon in rural areas, and in other words, most of the young people choose to go to city for work, while the middle-aged and elderly are much likely to stay in villages for agricultural production. On the other hand, this also shows an insufficient subsequent output of rural work force.
In view of the age structure of work force, the migrant rural population is mainly young adults, including 27.2% at the age of 16-25 and 28.4% at the age of 26-35. The proportion of young migrant rural population is over 50%. Although the young adults remain the main force of migrant workers, the migrant rural population may not continue the status of "unlimited supply", and the subsequent work force of young adults in rural areas has been in short supply. The aging of population may not allow rural work force maintaining the previous output structure. Thus, “migrant workers shortage” may exist for a long period, or even gradually become more serious.
V.Changing Trend of Urban Unemployment Rate in China[13]
According to the quarterly interview, the urban unemployment rate of China is 8.05% in June 2012, which is 0.05% higher than that in June 2011.
1.The Unemployment Rate of Young Workers Rises, while the Employment Situation of Aged Workers Has Improved.
According to the age distribution, the urban unemployment rate of China still shows an obvious U-shaped trend. That is to say, the low point remains in the middle-aged group at the age of 31-40, while the group at the age of 51-55 also shows a “tail-raising” phenomenon. In view of the changing trend, the rising unemployment rate is mainly reflected by the workers at the age of 26-30. As for this part of urban workers, the unemployment rate rises from 5.5% to 8.5%, with an increase of 3.0%. On the contrary, the unemployment rate of elderly workers at the age of 51-55 drops by 5.6%. The unemployment rate at other different age stages is basically stable.
Fig. 9 Changing Trend of Urban Unemployment Rate by Age Groups
2.The Work Force Market is Further Structurally Unbalanced.
According to the education background distribution, the unemployment rate fluctuates mainly among workers with middle education level or below. Fig. 10 shows that the unemployment rate of urban workers with primary school education or below rises from 5.3% to 8.7%, with an increase of 3.4%; that with junior high education drops from 11.4% to 9.6%, with a fall of 1.8%; that with junior high education or above but below bachelor degree is maintained stable basically; and that with bachelor degree or above rises from 2.3% to 3.6%, with an increase of 1.3%. Such change reflects a more serious structural unbalance in the work force market in China this year. One the one hand, “labor shortage” of ordinary workers is further deepened, and on the other hand, “employment difficulty” for college students still remains.
Fig. 10 Changing Trend of Urban Unemployment Rate by Education Level
3.Deterioration of Employment Situation of Migrant Workers
The overall unemployment rate of migrant workers rises from 3.4% in 2011 to 6.0% in 2012. As for different regions, the unemployment rate of migrant workers in east and west regions ascends greatly. The unemployment rate of migrant workers in the east region ascends from 2.7% to 5.8%, with an increase of 3.1%, while that in the west region increases from 4.5% to 7.7%, with an increase of 3.2%. That in the west region rises slightly, but with an increase of 0.9%. The deteriorated employment situation of migrant workers reflects the effect of economic downturn, and the depression of employment market is mainly reflected by the work force market of migrant workers.
Fig. 11 Changing Trend of Unemployment Rate of Migrant Workers
4.The Unemployment rate in the First-tier and Second-tier Cities Rises Obviously, while the Employment Situation in the Third-tier Cities Turns Better.
From the perspective of city size, the urban unemployment rate in the first-tier and second-tier cities rises obviously, while that in the third-tier cities drop sharply. The unemployment rate in the first-tier cities rises from 4.9% to 6.7%, with an increase of 1.8%; that in the second-tier cities even rises from 6.4% in 2011 to 8.7% in 2012, with an increase of 2.3%; on the contrary, that in the third-tier cities drops from 10.7% in 2011 to 8.0% in 2012, with a decrease of 2.7%.
Fig. 12 Change of Unemployment Rate in the First-tier, Second-tier and Third-tier Cities
Special Subject: Urban Population, Rural Immigrants and Migrant Workers
The permanent resident population in cities is not equal to the population with urban residence register. As urbanization is deepened, the rural work force continuously flows into cities. Some rural workers settle down and start their business in city, and they are “urban residents” from outside, namely “rural immigrants”. Without urban residence register, they are not equally treated in many policies (children’s education and medical security). As a new generation of “urban resident” in their families, they undertake large pressure to work hard and make living in the city. Another part of rural population is mainly floating population, also known as “migrant workers”[14].
This part of floating population has not stable works, with housing problems difficult to solve, and their other rights cannot be usually guaranteed. Therefore, in view of the study on the urban unemployment rate in China, it is essential to divide and research the above three types of work groups. The rural immigrants are usually defined as rural household individuals living in cities for a long period of time and owning house in the local place. However, the migrant workers are usually defined as rural household individuals who live in cities for a long period, but do not have house in the city. CHFS data shows that rural immigrants account for 28.3% of the total urban work force, while migrant workers account for 13.9%.
Fig. 13 Region Distribution of the Unemployment Rate of Urban Household Population, Rural Immigrants and Migrant Workers
Fig. 13 shows the unemployment rate of the three groups in different regions. [15]It is obvious that the unemployment rate of workers with urban household register is generally higher, up to 8,2%, 10.4% and 17.3% in the east, central and west regions respectively.
1.Coexistence of High Unemployment Rate of Urban Households and Low Unemployment Rate of Rural Immigrants
Compared with the rural immigrants which are also stable the work force, in the overall view or in different regions, the unemployment rate of urban household workers are much higher than that of rural immigrants, with the overall unemployment rate up to 9.9%, and 6.0% higher than the latter.
It is the relatively high retained wages of urban household workers that may result in the high unemployment rate for a long period of time. CHFS data shows that in the sample of employed group, the average annual income of urban household workers is the highest, up to 43,000RMB, more than a double of that of rural immigrants. As for different regions, the high wages of urban households are also obviously present. That in the east region is the most typical example. The average annual income of urban household workers is 51,000RMB, more than a double of that of rural immigrants.