China seeks to solve job market paradox

A graduate browses job information during a job fair in Hangzhou, Zhejiang province, Nov 25, 2015. [Photo/IC]

BEIJING - Facing a confounding paradox of labor oversupply and structural shortages, the Chinese government plans to take more targeted measures to improve the employment situation.

In the first half of this year, 7.17 million new jobs were created in cities, compared with this year's target of 10 million, data from the Ministry of Human Resources and Social Security (MHRSS) showed.

A plan for the 2016-2020 period unveiled by MHRSS Thursday set a target of more than 50 million new jobs in cities by the end of the period.

China's labor market is confronted with two prominent problems, according to Yin Weimin, head of MHRSS: pressure from a large pool of workers and a structural mismatch.

The ministry expects around 15 million young people to join the urban labor force each year between 2016 and 2020. College graduates represent the majority of the new job hunters.

In 2016, there were 7.65 million new college graduates in China. Only about 80 percent of them found immediately jobs on graduation. Meanwhile, some employers have difficulties finding suitable candidates for posts with high skill requirements, Yin said.

The coexistence of a skilled worker shortage and overall labor surplus indicates a contradiction between the country's industrial demand and the condition of the labor supply.

To address the problem, various measures have been attempted to create more jobs and improve employment services, including expansion of the service sector and supporting new businesses. Small and medium business account for more than 80 percent of China's employment.

The new MHRSS plan aims not just to hold the unemployment rate under 5 percent, but for higher quality employment all round.

To solve structural problems in the job market, more active job hunting will be encouraged, along with entrepreneurship and better dissemination of job information.

The threshold for market access and the barriers to starting businesses have already been reduced and are likely be further loosened.

Entrepreneurship training, especially on starting new businesses will be improved and more investment and financing channels for startups are promised in the plan. More low-cost, accessible startup incubators are in the pipeline.

More will be spent on training and on raising the quality of that training between now and 2020. Government-sponsored training will be offered to children from poor families, migrant workers in cities and the unemployed. The government will also ensure that at least one member of any family in extreme difficulties has a job, Yin said.