In making employment policies, the government should take into consideration the interests of both rural and urban labourers, said an article in the Outlook Weekly magazine.

The contradiction between increasing the supply of labourers and limited employment opportunities is expected to be a chronic headache plaguing the country's economic development.

It is predicted that during the 10th Five-Year Plan period (2001-05), some 40 million surplus rural labourers, equivalent to 35.71 per cent of the total urban employees in 2000, will be channeled to non-farming sectors in cities.

The exodus, however, is far from enough to increase efficiency in rural production, said the article.

To ensure that the income increase in rural areas catches up with the pace of economic growth and to strike a balanced development between rural and urban areas, some 15 million to 20 million rural labourers need to be transferred to non-farming sectors annually in the following five to 10 years.

Based on the country's areas of arable land and the world's average productivity level, it is estimated that the country's planting sector demands only 50 million labourers. At the end of 2000, however, the working population in rural areas numbered 499 million.

And China can no longer postpone the process of transferring surplus rural labourers, the article emphasized. A consensus has been reached that the way to achieve a sustainable increase of farmers' income is to reduce the number of farmers.

Without the successful transfer of surplus rural labourers, the reform efforts aimed at building a market economic system in China could not be deemed a success, and the country's industrialization and modernization would be hopeless, warned the article.

The influx of rural labourers, however, will inevitably intensify competition for limited job opportunities in cities.

Though the large-scale transfer of rural labourers into cities has been ongoing since the Ninth Five-Year Plan period (1996-2000), they did not bring about a direct challenge to urban labourers.

At that time, rural labourers were not on an equal par with their urban counterparts in terms of education and working skills. Thus, they were at an apparent disadvantage in job-seeking.

They mainly engaged in low-end jobs with lower requirements for educational background and skills. Such jobs were not appealing to most urban residents.

Furthermore, some local governments used to work out a series of discriminative policies against rural outsiders, which barred them from many jobs reserved for local laid-off workers.

The situation, however, is expected to change during the 10th Five-Year Plan period.

Local discriminative policies are being eliminated gradually.For example, a permanent residency card in a city is no longer a precondition for a job application.

Many young rural labourers are striving to improve their education and working skills through various channels. As a result, they are becoming more competitive in employment.

On the other hand, laid-off employees of State enterprises, with their older age and limited working skills, have to lower their expectations in seeking a job.

So the direct competition between some rural and urban labourers is within sight. The first to run into the direct collision will be competitive young rural labourers and the older urban laid-off employees.

The government is confronted with a tough challenge in making its employment policy co-ordinate the needs of both rural and urban labourers and prevent escalating confrontation between the two interest groups.

A new characteristic that has emerged since 2002 is that the competition for job opportunities is being internationalized.

Globalization means the redistribution of international capital in the world sphere, which also means the redistribution of job opportunities.

China should actively participate into the competition. The re-adjustment of the industrial policy should be orientated to helping China occupy a favourable position in the international competition for employment opportunities, the article concluded.