China is stepping up its policy support to promote employment, said a circular released on Tuesday on the official government website.

The circular allowed localities to raise the ceiling of the amount of small loans - a policy partly designed to help the unemployed open their own businesses - and lower the threshold for qualified borrowers when necessary.

The preferential tax policies, which reduce or exempt the tax burden on the unemployed and the disabled, should continue to be carried out till the end of this year. New policies would be introduced in 2009.

The government has been taking measures to encourage companies to recruit those who have had difficulty in finding employment. It was also creating more public service jobs.

China has implemented active employment policies since 2002. It has increased the number of the newly employed in cities from 8.4 million in 2002 to 12.04 million people last year.