Economy Apr 22

Getting China's millions back to work

State subsidies and online skills training are key facets in Beijing's efforts to get tens of millions of workers back into active employment

Getting China's millions back to work
Chinese citizens look for work at a job fair in Huai'an in eastern Jiangsu province in May 2019. Hundreds of online job training platforms have been set to help millions of unemployed rural people get new skills so they can find work more easily. Photo: Zhang Zhaojiu / Imaginechina via AFP

(ATF) China's Ministry of Human Resources and Social Affairs held a press conference on yesterday, Tuesday April 21, to speak about hot issues such as employment, distribution of pensions and training of citizens for online skills.

This ministry manages China's social security funds, which pay unemployment benefits, pensions and provide new skills training for workers that get laid-off. All employees and companies are supposed to contribute to the fund.

Government work units also get additional benefits like food and even holidays abroad. Work units are the backbone of Chinese industry.

Social security funds are now highly supervised by Beijing following a notorious scandal when Shanghai Party Secretary Chen Liangyu ‘borrowed’ several billion yuan to build a highway from Shanghai to Hangzhou. As road users had to pay a toll, Chen soon earned the money back and repaid the illegal loan to the fund. But a team of accountants sent by then-president Hu Jintao discovered the illegal transaction and Chen was sent to jail and replaced as Party Secretary by Xi Jinping, while Chen remains in jail.

The Social Security fund is now more centralised and used a tool of national policy. But there have been changes recently. Officials have said they did not pay out 28.6 billion yuan in March, as they had suspended social security to encourage people to go back to work.

According to Lu Aihong, a spokesman for the Ministry of Human Resources and Social Security, from January to March, 2.29 million jobs were added in cities and towns across the country, although that was a decrease of 950,000 from the same period last year.

Businesses allowed to pay less social insurance

The unemployment rate in the urban survey in March was 5.9%, a slight decrease from the previous month. Businesses were exempted and allowed to pay less social insurance premiums, which reduced payments by some 232.9 billion yuan. Payment of 28.6 billion yuan from February to March was suspended, which played a positive role in easing the funding pressure that state enterprises faced and helping them resume production, according to Lu.

Zhang Ying, director of the Employment Promotion Department at the Ministry of Human Resources and Social Affairs, said the employment situation in the first quarter of 2020 was more severe than previous years.

A series of "compensation-free reimbursement" policies, designed to stabilize jobs and expand employment, were launched. College graduates can now get subsidy policies that encourage small and medium-sized enterprises to hire workers, and expand the scale of recruitment at state-owned enterprises and institutions.

Getting people into work

Increased recruitment is being pushed at grassroots projects, along with recruitment into the military, and trainee employment schemes.

Last month, the ministry also launched “Online Spring Breeze”, in which people can seek jobs via the internet. A cloud platform for "hundreds of millions" to get "online recruitment special action" was said to be a success.

People can also register online as unemployed, and apply for unemployment insurance. "One-stop employment" services are provided for the unemployed for free.

Pensions

And in regard to the distribution of old-age pensions, Nie Mingjun, director of the Department of Pension Insurance at the Ministry of Human Resources and Social Security, said there is no problem with this service. There was a cumulative balance of more than 5 trillion yuan in the national enterprise pension insurance fund.

In March, the Ministry of Human Resources and Social Affairs, together with the Ministry of Finance, issued a central transfer prepayment plan for the enterprise basic pension insurance fund for 2020. In early April, transfer funds for the first quarter were fully allocated.

A second issue involves regularly scheduling capital arrangements for the provinces, and conducting a detailed investigation of the annual fund's preparations to help coordinate scheduling of funds.

The ministry will guide the provinces to speed up provincial-level coordination, as well as solve the problem of unbalanced funds within provinces, and better ensure the distribution of pensions throughout the provinces. Up to now, 20 provinces across the country have implemented the collection and expenditure of funds.

23 million labourers out of work

Employment is obviously an important way for the poor to move out of poverty and lift their income. According to Zhang Ying, as of April 10, more than 23 million labourers were out of work, which was 86% of the total unemployed. As these labourers are mostly from rural areas, they do not receive any benefits, unlike work units.

Zhang Ying said poverty alleviation was important. Many of these individuals are being encouraged to go on online training to be able to work in the high-tech infrastructure projects that Beijing is planning, such as the 5G rollout.

Zhang Lixin, director of the Department of Professional Capacity Building at the Ministry of Human Resources and Social Sciences, said that as of April 17, 31 provinces had set up names and websites for online skill training platforms – some 839 in total.

These have been included in the directory of training institutions where people can improve their vocational skills. People can do nearly 20,000 courses, which cover more than 100 occupations and more than 1,000 job skill modules, and nearly 240,000 class hours.

Some 5.9 million people have registered on the online platforms to boost their vocational skills. Officials believe this will play a positive role in boosting employment and getting production back on track.

Zhang Lixin said that through policy incentives, workers and businesses are encouraged to participate in online skills training. Training subsidies is one method used to push this. People who participate in online training and can obtain qualification certificates for the courses they do and get training subsidies in accordance with regulations.

Subsidies can also be given for living expenses. ‘Poor labourers’ who are unemployed can get an allowance – the size of which is decided locally – if they attend training.

And, of course, this training is likely to include courses on Xi Jinping Thought.