Mao, Yanbing

Unemployment in the Process of Economic Development in China

China has experienced rapid economic growth since the economic reform in the late 1970s. Whether economic growth can always bring about corresponding employment growth or decreasing in unemployment becomes am important issue onanalyzing the recent problem of increasing in the unemployment rate in China. This book has examined the issue of unemployment and the emergence of the modern labour market in the process of economic development of China.The Lewis Model and the Harris-Todaro Model as well as the Neo-Schumpeterian theories regarding technological progress and searching-matchingapproaches supply theoretical framework for analyzing the causes of unemploymentin China. A typical dual economic structure determines a large scale of migration fromrural to urban areas with the significant development of agricultural economy andindustrialization. In the process of transformation from centrally planed economy tomarket economy, a large number of redundant workers were released from the stateowed enterprises. Due to the peak of labour force population, young labour entrantsadditionally enhanced the pressure of employment. In essence, The Chinese economic development has been in an unprecedented period of large scale structural adjustment.Technological progress is regarded as the motivation of economic growth and structural adjustment. A so-called u201ccreative destruction effect u201d enhanced mismatchingbetween labour supply and labour demand, which induced increasing in unemployment in the modern labour market. Therefore, economic growth does notnecessarily bring about employment growth, but even increases the level of unemployment in a certain period. In a medium- and long term, the issue of unemployment in China is mainly caused by structural factors.