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Chapter 14:

Employment, Recession & Recovery

China to roll out measures to maintain stable employment

January 14, 2019

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Young Chinese graduates looking for employment

China will implement a series of measures to maintain a stable employment rate this year, amid its grappling with the impact of a slowing economy due to the damaging trade dispute with U.S., its largest trading partner. Sources have said it plans to set a lower potential output target of 6 to 6.5% in 2019, as compared with around 6.5% in 2018. Additionally, China's urban unemployment rate (counting frictional and structural unemployment) was 3.8% by the end of 2018, , however, “For 2019, China still faces large employment pressure, with more than 15 million newly-added job-seekers in urban areas, including a record number of 8.34 million college graduates expected," the human resources ministry official added. This could very possibly lead to underemployment, where workers hold jobs that don’t fully utilize their skills or hold part-time positions when they wish to hold full-time ones. College graduates, migrant rural workers and veterans should be given targeted assistance in finding jobs, the official said, adding that more skills training channels should be opened for the unemployed to prevent discouraged workers.

Glossary

1. Employment Rate

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            The total number of people employed divided by the total labour force.

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2. Potential Output

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            The GDP that the economy could produce with full employment.

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3. Frictional Unemployment

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           Unemployment caused by workers who are between jobs or who are entering/re-entering the labour force.

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4.Structural Unemployment

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           Unemployment caused by long-term changes in the economy, such as shifts from goods production to services, or the introduction of technology that replaces labour.

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5.Underemployment

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           A situation in which workers hold jobs that do not fully utilize their skills or that employ them only part time when they wish to work full time.

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6.Discouraged Workers

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           Those who would like to work but have stopped looking because they believe nothing is available for them.

© 2019 Elaine Zhou

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