ChinaseekstohelpretrenchedworkersfindnewopportunitiesByJiJing&YuShujun
Oncetheeconomytransformstoonethatisinnovative,environmentalfriendly,low-carbonandcenteredonhi-techindustriesandconsumption,societywillbemuchmorestable.
LinYueqin,DirectorofInternationalDepartmentIIatChinaSocialSciences,ChineseAcademyofSocialSciences
ChinesemicrobloggerDuomaguoexplainswhyhedecidedtoquitthestate-ownedWuhanIronandSteel(Group)Corp.(WISCO),ajobknownasan“ironricebowl”-asecurejobinastate-ownedcompany.
“Becauseit’snotan‘ironricebowl’anymore.ThesteelindustryisundergoingdrasticchangesandWISCOisnoexception,”Duomaguoblogged.
Duomaguo,whohasfoundanewjobatanemigrationcompany,isconsideredlucky.ThelikelihoodoflayoffsishangingliketheswordofDamoclesovermillionsofworkersasChinaseekstoslashovercapacityintraditionalindustriesandshiftitsgrowthenginefrominvestmenttodomesticconsumption,servicesandinnovation.
TheChineseGovernmentannouncedinFebruarythatanestimated1.8millionworkersfromthecoalandsteelsectorswouldberelocatedtoaddressovercapacity.
InMarch,MaGuoqiang,PresidentofWISCO,toldPeople’sDailythecompany’ssteelmakingbusinesswouldneedonly30,000employeesifthede-capacityreformgoesthrough.WISCOcurrentlyhas80,000employees.
However,SunJin,DirectorofWISCO’sPublicityDepartment,saiditdoesn’tmeanthe50,000workerswouldbeaxed.“Ifanewspaperfindstherearetoomanyreportersanddispatchessometodoproofreadingorpart-timedistributionandcontinuestopaytheirsocialinsuranceandlivingsubsidies,canitbesaidithaslaidoffitsreporters?”Sunsaid.
Evenso,resettlingmillionsofworkersstillposesachallengeforthegovernment,asitdirectlyaffectstheinterestsoftheworkers,theimplementationofsupplysidestructuralreform,andoverallsocialstability.Thoughtheprocessmaynotbesmooth,thegovernmentisdeterminedtotackletheissuetominimizetheimpactonworkers’familiesandsociety.
Afundof100billionyuan($15.4billion)hasbeenallocatedfortherelocationandPremierLiKeqiangsaidinMarchitcouldbeincreasedifnecessary.
Industrialevolution
“Thelatest[reform]planisnotasignthatChinaisabouttobeswampedbyawaveofunemployedworkers,”wroteErnanCui,ananalystatfinancialservicescompanyGavekalDragonomics.
InanotepublishedonMarch10,Cuisaid,“China’sjobmarkethasbeenadjustingtotheendofthehousingboomfortwoyearsalready,andwhilethisadjustmentishardlypleasant,itisalsomanageable.”Thelossof1.8millionmoreworkerswas“lessaradicaldeparturethantheevolutionofanexistingtrend.”
PhilipMoscoso,professorattheIESEBusinessSchoolinSpain,said,“Thegoodthingisthatthegovernmenthasrecognizedtheproblem.”
MoscosoexplainedthatChinaisundergoingatrendthathashappenedinmostothercountriesaswell.“Youhaveaneconomythatstartstodevelopandatsomepointyoumovefromamoreheavyindustrialbaseoutputto[aneconomywhichis]morevalue-added,hi-tech,knowledge-intensive,andheadingtowardmoreservice-basedbusiness,”hesaid.“Ifyouputitintheoverallpicture,that’sanaturalthing.”
AccordingtoLinYueqin,DirectorofInternationalDepartmentIIatChinaSocialSciencesundertheChineseAcademyofSocialSciences,thisisaprocessChinahastogothroughinthelongterm.“Thegovernment,enterprisesandindividualsworkersallneedtoadapttothechangesbroughtaboutthetechnologicaladvancement,”Linsaid.
“Oncetheeconomytransformstoonethatisinnovative,environmentalfriendly,low-carbonandcenteredonhi-techindustriesandconsumption,societywillbemuchmorestable.”
ThedirectorsuggestslearningfromcountriessuchasRussiaandtheUnitedStatesaboutprovidingsocialreliefandtrainingforworkerslaidoffintheprocessofindustrialrestructuringtohelpthemsecurereemploymentandrelevantjobinformation.
Migrantjobs
WorkersfromnorthChina’sShanxiandHebeiarelikelytobeaffectedthemostsincetheseprovincesareChina’slargestcoalandsteelproducers,respectively.
Hebeiwillseeupto150,000steelworkerslaidoffthroughouttheprovince,accordingtotheprovincialauthorities.Around100,000workerswillneedtoberesettledinfiveyears,saidSongLimin,DeputyChiefofHebeiProvincialDevelopmentandReformCommission,atapressconferenceonApril21.
Itwillbedifficultfortheseworkerstofindsimilarjobslocally.“Sooneofthemainsolutionsislikelytobe[workers]relocatingtoacoastalprovincewheretheyaremorelikelytofindadecentjob,”Cui,theanalyst,said.
Eveniftheyweretomigratetootherareasofthecountry,howwouldthataffecttheprovincesthey’veleftbehind?Explainingtheconsequences,Linsaid,“ThehugetransitionwillcreategreaterdevelopmentopportunitiesastheseprovincescandirectlytransformfromthefocusonhighlypollutingindustriestothosecenteredontheInternetandenvironmentalprotection.”
Theworkerslackingskillswillstillhavetobelaidoffinprovincesover-reliantonresourceindustries,Linadded.“Theefficiencyofproductionwillimproveandtheirsalariesandconsumptionabilitymayimproveaswell.”
Songsaidsomeenterpriseswillnotgobankruptafterovercapacitycut.Theywillcontinuetoprovidejobopportunitiesthroughmergersandacquisitions.
Theserviceindustry,whichaccountsformorethanhalfofChina’sGDP,isconsideredareliablesourceofjobcreation.
Linsaidthosewhoarelaidoffwillfindjobsintheservicesectorafterreceivingtraining.Somemayevenstarttheirownbusinesses.“Aftertwoorthreeyears’adjustment,theoverallincomelevelmayincrease,”thedirectoradded.
Resettlingretrenchedworkers
Thegovernment’sApril7guidelinehasoutlinedfourmeasurestoresettlethosetobelaidoff:relocationwithinthecompany,retraining,earlyretirement,andsocialsecuritysubsidiestothosehavingdifficultyfindingnewjobs.
A“back-to-work”programshouldbecreatedsothatworkersreceivetrainingandcareerguidanceforfree.Theprogramwillalsoopenchannelsforthosewhowanttostarttheirownbusinesses,givingthemaccesstogovernmentsupport.
Thegovernmentwillarrangespecialjobfairsforthosetoberesettled,andcanprovidelivingallowancesforthosewhowillberetrained.
Localauthoritiesarerequiredtoenhancetransregionalcooperationtorelocateredundantworkerstoregionswithemploymentopportunities.
“TheHebeiProvincialGovernmentismullingspecificmeasuresforresettlingworkers.Wehavealreadytakenaseriesofmeasuresincludingtransferringthemtootherpositions,”Songsaid.“Wewillmainlyallocateworkerstotheserviceindustryafterofferingthemrelevanttraining.”CA