There have been great changes in China' employment system since the country adopted its reform and opening-up policies. The unemployment rate stands high and the urban registered unemployment rate has always been above 5 per cent. A large number of unemployed labourers need help. The employment risks for some groups and regions are especially eminent, which could lead to social crisis if not properly addressed.

A worker stands among scaffolding in Beijing September 9, 2006. China's registered urban unemployment rate stood at 4.2 percent at the end of June, the same as at the end of March and at the end of 2005, Xinhua news agency reported. In the first six months, China created 6.08 million jobs in urban areas and re-employed 2.36 million laid-off workers, it added. [Reuters]

The current employment security system is a combination of unemployment insurance and proactive employment policies. The majority of labourers, however, are not covered by the security system: only about 40 per cent of urban employees have unemployment insurance; workers laid off by non-State enterprises and other unemployed labourers are not covered by the pro-active employment policies. Unemployment insurance only accounts for 12.7 per cent of the social average wage an unemployment relief that cannot provide sufficient guarantees for life.

Therefore, more efforts should be made in this regard.

First, the unemployment insurance, relief and welfare systems should be improved. The unemployment insurance level should be increased. The insured period should be shortened to urge the unemployed to find new jobs as soon as possible. The unemployment registration system should be perfected to let all labourers get registered in the places they live. Services and jobs should be provided as major assistance with cash and goods given as supplements.

Second, the proactive employment system should be improved. According to national conditions, the policies should focus on helping current employees stabilize their employment whilst helping the unemployed find jobs. Various policies should be straightened out and institutionalized through legislation.

Third, the employment security input system should be perfected. A budget system should be established and well implemented. The central government should adjust the financial input structures and make transfer payments to poverty-stricken areas. And a supervision system should be set up to ensure efficient money use.

Last but not least, the legislative work should be enhanced. Related laws such as the Law on Employment Promotion and the Labour Contract Law should be implemented to the letter.

(China Daily 09/14/2006 page4)

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