Observation (CEACR) - adopted 2008, published 98th ILC session (2009)

Employment Policy Convention, 1964 (No. 122) - China (Ratification: 1997)

The Committee notes the information provided in the Government’s report received in August 2007 including replies to its previous observation. It also notes the comments by the All-China Federation of Trade Unions (ACFTU) and the China Enterprise Confederation (CEC), appended to the Government’s report.

1. Articles 1 and 2 of the Convention. Formulation of an employment strategy. The Committee notes that by the end of 2006, 764 million people were employed in China, of which the urban employed accounted for 283 million people. In terms of the employment structure, 326 million people were in the primary sector of industry, 192 million in the secondary sector and 252 million in the tertiary sector, which is the result of a rapid transition of the rural labour force to non-agricultural industries. It also represents a steady increase of the proportion in the tertiary industry, demonstrating that the services industry has become a major source for the expansion of employment. The Government indicates that, by the end of 2006, registered unemployment in the urban areas accounted for 8.47 million people, representing an unemployment rate of 4.1 per cent, demonstrating a trend of decreasing unemployment and increased stability in employment. The Government indicates that some 21.48 million persons were affected by poverty at the end of 2006, representing a drop of 2.17 million persons over the previous year. The Government forecasts that in forthcoming years the number of the urban population in need of employment will remain over 24 million every year, while the present economic structure can only afford 12 million jobs, which demonstrates an imbalance between supply and demand for jobs. The Committee wishes to continue to receive information on how the goal of full employment guides macroeconomic policies. In this respect, the Committee would like to examine information on the manner in which other macroeconomic policies, such as monetary and fiscal policies, advance the promotion of full, productive and freely chosen employment. The Committee also requests information on how the measures taken to promote full and productive employment operate within a “framework of a coordinated economic and social policy”.

2. The Government’s report provides information on the adoption of the Labour Contract Law which standardizes practices in full-time employment and includes special provisions concerning contingent work and part-time work. The Government indicates that the law provides protection for workers’ rights and interests in different types of employment. The Government also provides details on the adoption, in August 2007, of the Employment Promotion Law which includes provisions addressing, amongst other things, the promotion of employment, protection of fair employment, government support to employment promotion, employment assistance to special groups, public employment services, strengthening of vocational education and training,  with a view to promoting coordinated economic and social development, expanding employment opportunities, promoting employment and realizing social harmony and stability. The Committee asks for information regarding the manner in which the texts enacted are contributing to the generation of productive employment and the improvement of employment security for workers.

3. Promotion of employment and vulnerable groups. The Government indicates that, by the end of 2006, the population in poverty in the rural areas was 21.48 million, representing a decrease of 2.17 million over the previous year and that the population in rural areas with a low level of income was 35.5 million, representing a drop of 5.17 million over the previous year. The Government has made efforts to promote employment of the rural labour force in their own localities, through readjusting the economic structure in agricultural and rural areas, developing non-agricultural production, boosting township industries and constructing small cities. It has adopted policies for equal employment, improved conditions for urban employment, and organized and guided an orderly mobility of the rural labour force, across the regions, through labour service coordination. The Committee invites the Government to continue to inform on the efforts made to further reduce the gaps between the employment situation of urban and rural workers. It also invites the Government to include information in its next report regarding the measures taken to ensure economic recovery with employment creation in those areas affected by the earthquake in Sichuan Province (May 2008).

4. According to the statistics provided by the Government in its report, of the 82.96 million persons with disabilities, 22.66 million have been in employment. The Committee notes that the Regulations concerning the Employment of People with Disabilities establish that authorities at and above the county level should include, in their plan for economic and social development, the issue of employment for persons with disabilities and formulate preferential policies and adopt practical measures to create conditions for employment of persons with disabilities. The Committee wishes to continue to receive information on the measures adopted to open up channels for employment for persons with disabilities and, in particular, to support persons with disabilities in rural areas.

5. Consistency and transparency of labour market information. The Committee notes that the Government indicates progress in improving the labour market information system, specifically by: (a) collecting, processing and analysing information concerning supply and demand in labour markets in over 100 cities and publicizing the results; (b) organizing and conducting investigations of personnel costs in enterprises and the salary scale for different professions in the whole country; and (c) continuing the survey of the labour force. The Committee wishes to receive information on the improvements made to the labour force survey and progress in the enhancement of the labour market information system, with an indication of the manner in which the data has been used to formulate and review employment policies.

6. Unifying the labour market. The Committee notes that, according to data available to the ILO, internal migrant workers account for 16 per cent of national GDP growth over the last 20 years and represent 40 per cent of the urban workforce. Yet today, 90 million internal migrant workers cannot obtain an urban residence and work permit (hukou), giving them access to better jobs, health care and education. The Committee also notes that in the past few years, the Government has taken important steps, such as ensuring a guaranteed minimum wage and the enforcement of a labour contract system, as well as improving access to employment services and job training. The Committee also notes that in some localities the disparity between urban and rural residents has been removed. In its report, the Government indicates that it is adopting various measures to further improve the present permit system. Efforts have been made to fully guarantee the legitimate rights and interests of internal migrant workers in employment, housing, medical care and education so as to form a nationally unified labour market. The Committee wishes to continue to receive information on the measures adopted to improve the residence and work permit system in order to ensure labour market integration and a unified labour market.

7. The Committee notes that the Government is implementing the public budget and a sunshine budgetary policy to increase budgetary allocations for social insurance. The competent authorities in the various localities have also readjusted their expenditure structure to support social insurance. The Committee further notes the information regarding the intensified guidance provided to social insurance agencies at various levels, and the promotion of social insurance coverage through publicity and law enforcement inspections in the workplace. The Government reports that, by the end of May 2007, a total of 191.93 million persons participated in the old-age insurance; 163.45 million in medical insurance; 107.46 million in work injury insurance; and 67.72 million in child birth insurance, representing an increase over the situation at the end of 2006 of 2.27 million persons, 6.13 million, 4.78 million and 2.14 million people, respectively. A total of 25.15 million and 29.16 million migrant workers have participated, respectively, in the medical insurance and work injury insurance, with a respective increase of 1.49 million and 3.79 million over that at the end of 2006. The Committee asks the Government to include information in its next report on the measures it is taking to encourage employers and employees to contribute to social insurance schemes, considering the proportion of self‑employed and informal employees in the urban areas. It also requests information on how the social security system considers the challenges of flexible employment such as low wages and unstable income.

8. Reinforcing public employment services. The Committee notes that by the end of 2006, a total of 37,450 employment service agencies were established. In 2006, these employment agencies recruited 49.51 million people for various enterprises and provided job recommendations and employment guidance to 47.36 million people who were registered for jobs, of whom 24.93 million were successfully recommended to jobs. The Committee reiterates its request to receive information describing the measures taken to ensure cooperation between the public employment service system and private employment agencies. It also wishes to receive information regarding the current employment registration system in rural areas and proactive measures oriented to help the rural unemployed.

9. Measures to promote the re-employment of laid-off workers. The Government reports on the difficulties in solving problems left by the economic restructuring. Between 2003 and 2006, a total of 20 million workers that were laid off from state-owned enterprises and collectively owned enterprises were re‑employed. Technical training programmes which facilitate the self-employment of such laid-off workers have been defined and developed in line with the specific conditions in the localities. The Committee asks the Government to continue to supply information on the measures taken to improve the technical skills of laid-off workers in order to enhance their employability. It also requests information on the measures it envisages to improve the stability of workers and to reduce employment insecurity in the labour market.

10. Promoting small and medium-sized enterprises. The Committee notes that over the last years most job creation has come from the non-state sector, especially small business, self-employment and the informal sector. In 2005, the Government issued “Views on Encouraging, Supporting, and Guiding Development of Small Business and the Non-State Economy”. The Government reports that, through the implementation of these guidelines, all regions and government departments will promote private and self-employment and the development of the non-state economy, thus stimulating job creation to the fullest and, in particular, generating opportunities for low-income groups. The Committee wishes to receive information on the impact of the measures adopted to minimize the obstacles encountered by small and medium-sized enterprises, for example in obtaining credit to start up businesses. Please also continue to provide information on the manner in which employment creation is promoted through small and medium-sized enterprises.

11. Vocational training and education. The Committee notes that the information provided by the Government indicates that it has developed various types of vocational training initiatives and intensified efforts to foster highly skilled people in employment, and in close relation to the needs of the market and of enterprises. By the end of 2006, there were a total of 2,880 technical schools, 3,212 employment training centres and 21,462 private training institutions, which provided training to 22.43 million people. The Committee asks the Government to supply information on the measures taken to ensure that vocational training and educational policies are oriented to cover the demands of the labour market. Please also provide information on the measures taken to increase the viability of rural workers in the labour market through formal and on-the-job training.

12. Article 3. Consultation of representatives of the persons affected. The Committee notes from the Government’s report that the ACFTU and the CEC have actively participated in the formulation of laws and regulations relating to the Labour Contract Law and the Law on Employment Promotion. The Government reports that trade unions at various levels have set up vocational training and job agencies, and popularized the re‑employment model of microcredit loans, entrepreneurship training and the re‑employment nurturing base. The Committee also notes the CEC’s statement indicating that, in promoting corporate social responsibilities among the enterprises, enterprises have been called upon to create more employment opportunities, especially jobs suitable for young people. The Committee wishes to continue to receive information regarding consultations to secure the full cooperation of representatives of the social partners in the formulation and implementation of employment policies. Please also indicate the measures taken or envisaged to ensure that representatives of the rural sector and the informal economy are also included in the consultations required by the Convention.

13. Part V of the report form. ILO technical cooperation. The Committee notes that the ILO, in collaboration with national partners, is implementing a project and conducting activities aimed at enhancing the capacities of government, employers’ and workers’ organizations, associations of persons with disabilities and NGOs, to enable them to promote legislation relating to the employment of persons with disabilities, as well as to improving the working environment so as to increase employment opportunities for persons with disabilities in China. The Committee also notes that the Start and Improve Your Business (SIYB) China Programme, Phase III, was implemented jointly by the Ministry of Labour and Social Security and the ILO, with financial inputs from the Department for International Development (DFID, United Kingdom), to facilitate the socio‑economic integration of particularly vulnerable categories of persons among the local migrant community by enabling them to start up and run their own small social businesses, covering western cities and provinces in China. The Committee requests the Government to provide information on the results that have been achieved, in terms of job creation and the integration of jobseekers in the labour market, as a consequence of the advice and technical assistance from the ILO and other international donors.