Individual Case (CAS) - Discussion: 2009, Publication: 98th ILC session (2009)

A Government representative expressed appreciation to the Committee of Experts for its positive comments and observations on the report concerning the application of Convention No. 122 by China, which would assist its efforts in employment promotion.

China was strongly committed to the objectives of Convention No. 122 in working towards full, freely chosen and productive employment. The Convention provided a good framework for China to tackle its employment challenges. With a population of 1.3 billion, China’s Government had always given priority to employment and had made unremitting efforts to effectively apply Convention No. 122. The Government’s report detailed the national laws and policy measures on employment promotion and their implementation.

The labour market was being expanded in favour of a sustainable and job-rich economic growth. The Government had devoted its attention to developing labour-intensive and tertiary industries, private enterprise and enterprises with foreign investment, small and medium-sized enterprises (SMEs), self-employment and flexible forms of employment. To ensure that job creation was placed at the centre of macroeconomic policies, governments at all levels had established interdepartmental employment working groups for policy coordination. At the central level, the group was headed by a vice premier and brought together representatives of more than 20 ministries.

Active employment policies were being adopted, focusing on: tax reduction, micro credit and interest-subsidized loans for business start-up and self-employment; hiring incentives such as tax reduction and social insurance contribution subsidies for enterprises that recruited unemployed people; public job creation schemes for hard-to-place workers; and targeted employment assistance programmes to ensure every family had at least one member in employment.

Measures were being taken to develop a unified labour market and provide public employment services. Such services were currently offered free of charge to both rural and urban workers, with 37,000 employment agencies, including 24,000 public ones, operating across China by the end of 2008, assisting 20 million people to find work that year.

In order to strengthen skills training and improve workers’ employability, China had established an employment-driven vocational training system for both urban and rural labour forces. By the end of 2008, there were more than 3,000 technical schools, more than 3,000 job centres and more than 21,000 private training institutions providing training for 20 million people per year, including 9 million rural workers.

Labour legislation and enforcement were being improved to protect rights at work. The Government had promulgated a series of laws and regulations on issues such as labour contracts, employment promotion and employment of disabled persons. The Labour Contract Act had increased the number of labour contracts concluded and reduced the use of short-term labour contracts, thereby increasing job security. The Employment Promotion Act had translated active employment policies into law, providing powerful legal support for achieving full employment. A minimum wage had been established in all provinces and municipalities and was increased at least once every two years. A new department had been set up in 2008 within the Ministry of Human Resources and Social Security with responsibility for protecting rural migrant workers and enhancing labour inspection. A special training programme had been launched in 2006 to train 40 million rural workers over five years and action plans had been implemented to extend social security coverage to migrant workers.

Thanks to successful implementation of the above policies, China had maintained a steady increase in total employment and improvements to its employment structure. Since 2003, over 10 million jobs had been created and more than 8 million workers transferred from rural areas each year. Registered urban unemployment stood at 4.2 per cent in 2008.

The financial crisis had mainly affected China’s real economy, especially the export sector and SMEs. Migrant workers and new labour entrants, including college graduates, had been among the most affected. A range of measures had been taken to respond to the crisis. Domestic demand had been boosted to ensure economic growth and promote employment, with a stimulus package worth US$6.8 billion focusing on infrastructure, public works, rural development investment and support for labour-intensive industries, particularly SMEs and the service sector. From design to implementation, major projects were required to give due consideration to their impact on employment. To safeguard enterprises and jobs by easing the burden on enterprises, companies in difficulties were allowed to postpone or reduce payment of social insurance contributions, and various subsidies were provided to enterprises that experienced difficulties but managed to retain workers through in-service training, work-sharing or flexible wage arrangements.

Active employment policies were being scaled up, with greater jobseeker incentives for the unemployed, migrant workers and university leavers. Public employment services were being improved: from 2009 to 2011, a programme would be launched to provide internships for 3 million college graduates, and for 2009 there were plans to help 1 million long-term unemployed people to find jobs and assist 8 million migrant workers to transfer to the non-agricultural sector. A special two-year training programme had also been launched for workers in enterprises with difficulties, rural migrant workers, laid-off workers and new labour entrants, which was expected to train 15 million people during 2009.

Social dialogue was being promoted as a tool to respond to the crisis. Enterprises were encouraged to improve management and technological innovation in order to minimize job cuts, and unions were encouraged to guide workers to understand and support measures taken by enterprises, such as flexible working hours, etc.

Social security coverage was being expanded to ensure that more people, particularly rural migrant workers and people in flexible forms of employment, could enjoy its benefits, and the establishment of a basic medical insurance system was being accelerated. From 2009 to 2011, governments at all levels would invest around US$120 billion in improving medical insurance and the medical service system. By 2010, every one of the country’s 1.3 billion citizens would enjoy full health insurance coverage.

Recalling the enormous loss of life and property caused by the Wenchuan earthquake in Sichuan province in 2008, he expressed appreciation for the sympathy and support shown by the international community in the wake of the disaster. Various employment policies had been put in place to tackle its consequences, including: adopting emergency response measures and special employment aid programmes to recover production and stabilize employment; organizing more than 20 provinces to give “one-to-one” employment assistance to individual counties, with jobs provided through aided reconstruction projects; and helping workers find employment through labour migration programmes. By March 2009, 100,000 people had been re-employed through aided reconstruction projects and more than 3 million had found work through labour migration programmes. The post-disaster reconstruction was running smoothly with stable labour market recovery.

The speaker highlighted and expressed appreciation for the strong support received from the social partners. The All-China Federation of Trade Unions and the China Enterprise Confederation had not only actively participated in the development and implementation of various laws, regulations and policies, but had also pursued various employment programmes. China had enjoyed support from the ILO and foreign governments, and had undertaken broad cooperation with the ILO and governments in the field of employment through projects on labour legislation support, the ILO’s Start and Improve Your Business programme, employment aid to disaster-stricken areas, youth employment, rural migrant employment, employment for the disabled and other issues. Such cooperation had given China the benefit of international experience, significantly aiding its employment promotion activities, and he expressed appreciation in that regard.

Although his Government had adopted a series of measures to promote employment and had made great progress, China would face long-term employment pressure through factors such as its huge population, industrialization, urbanization, economic restructuring and the comparatively low quality of its labour force. Every year, China had 24 million jobseekers in urban areas and 10 million rural labourers yet to be transferred, resulting in a degree of employment pressure not experienced by any other country. Nevertheless, he was confident that the issue could be properly addressed, which would not only benefit China’s economic development and social stability but also contribute to world peace and development. His Government’s commitment to the goals of Convention No. 122 remained unchanged and work would continue to implement and improve various policies and measures to promote employment, including, as suggested by the Committee of Experts, establishing a unified labour market and improving the labour market information system. Information on progress made would be provided in the Government’s next report. China stood ready to further strengthen exchange and cooperation with the international community in the field of employment, to share experiences, and to jointly promote the realization of decent work for all.

The Worker members appreciated that the Government had submitted detailed and updated information concerning the employment situation, which had been communicated to the Committee of Experts in 2006, i.e. before the economic and financial crisis. Over the past 30 years, China had been progressively oriented to the market economy and experienced considerable expansion of the urban private sector and a simultaneous decline of state-owned enterprises. In that context, supply and demand of jobs developed in a different manner. There were currently in China 24 million people looking for a job in urban areas, whereas the economy could only afford 12 million jobs per year. A certain amount of hidden unemployment in rural areas and at state-owned enterprises should also be taken into account. In the context of the economic crisis, challenges for the Chinese labour market became even more difficult to meet. The following problems could be also noted: the adaptation of vulnerable categories of workers, particularly the rural population having a low income; the integration of people with disabilities into the economy; the re-employment of workers of state-owned enterprises; the situation of internal migrant workers; and the quality of jobs, particularly as regards occupational safety and health.

The Worker members noted that, even if China had at its disposal labour legislation covering in a satisfactory way labour contracts, working hours and overtime work, minimum wage, termination of employment, etc., the major problem was that the respective provisions were applicable to a very little extent, supervision was rare and sanctions were inefficient. There were currently in China 145 million workers not receiving the minimum wage. There were also difficulties in the payment of wages: according to the trade unions, 70 per cent of the 100 million migrant workers in the country were paid late or were not paid at all. The social security coverage of workers was manifestly inadequate. In 2006, 25 per cent out of 764 million workers had an old-age insurance, 21 per cent had sickness insurance, 14 per cent had employment injury insurance and 9 per cent were entitled to related benefits. The Worker members concluded that it was important to see how the Government intended to remedy these deficiencies.

The Employer members recalled that Convention No. 122 required that each Member declared and pursued, as a major goal, an active policy designed to promote full, productive and freely chosen employment, by methods that were appropriate to national conditions and practices, and in consultation with the social partners. The case thus did not call for an analysis of national legislation vis-à-vis the terms of the Convention but rather for a broader analysis of the question of whether China’s employment and labour market policies were in line with Convention No. 122. They expressed their appreciation for the full and detailed information provided by the Government and noted that the case was examined by the Conference Committee for the first time.

In its most recent observation, the Committee of Experts had noted that unemployment had dropped and that stability in employment had increased. It had also noted the adoption of the Labour Contract Act and the Employment Promotion Act that included, inter alia, provisions addressing the promotion of employment, government support to employment promotion, strengthening of vocational education and training, and expanding employment opportunities. The Committee of Experts had asked for additional information on the manner in which the goal of full and productive employment guided macroeconomic policies, and how national legislation contributed to the achievement of that goal. The Committee had also noted the Government’s efforts to promote employment of the rural labour force in their own localities, and the policies adopted for equal employment, improved conditions for urban employment and organized mobility of the rural labour force. The Committee of Experts had requested the Government to supply further information on measures taken to reduce the gap between the employment situation of urban and rural workers. According to the Committee of Experts’ comment, the Government had adopted legislation requiring the inclusion of the issue of employment for people with disabilities into the plan for economic and social development. The Committee of Experts had asked the Government to indicate further measures taken to increase employment for people with disabilities. The Employer members strongly encouraged the Government to continue to provide full details on all the abovementioned points.

Moreover, the Committee of Experts had asked for additional information on the social insurance scheme. The Employer members felt that such information could only be considered meaningful in the context of the Convention to the extent that it was linked to the effectiveness of active employment policies. Noting with interest that most job creation in the past few years had stemmed from private SMEs, the Employer members were pleased that the Government continued to support sustainable enterprises, in particular small and medium-sized ones, and invited the Government to continue to provide relevant information in this regard. They further noted with interest the vocational training initiatives undertaken by the Government and encouraged it to continue to furnish particulars on educational policies addressing labour market demands. Lastly, the Government should continue to consult the social partners in respect of each of the policies designed to promote full and productive employment.

The Worker member of China drew attention to the request addressed to the Government by the Committee of Experts for more information on issues including formulation and implementation of employment policy, further improvement of the labour market, expanding employment, promoting social harmony and stable development, eliminating the disparity between urban and rural workers, optimizing the current social insurance schemes, strengthening vocational education and training and providing employment assistance to disabled people, particularly in rural areas. By requesting such information, the Committee of Experts was playing an active role in pushing the Government to improve its plans and policies on such matters. He expressed his appreciation for the attention given by the Committee to employment in China and indicated that China’s trade unions would do their part in urging the Government to improve the application of Convention No. 122, in accordance with the Committee of Experts’ requests and expectations.

As the world’s largest developing country, with a population of 1.3 billion, China was facing a severe imbalance between demand and supply in the labour market. The situation had been aggravated by the global financial crisis, worsening China’s unemployment rate even further. Every year, China had some 24 million jobseekers in urban areas and around 10 million urban workers sought transfer to other jobs, while 6 million new graduates entered the labour market. The Committee of Experts had paid particular attention to rural migrant workers in China, who currently numbered around 230 million and of whom some 120 or 130 million were employed in cities. The financial crisis had had a major impact on SMEs in China’s eastern coastal region, where more than 60,000 SMEs had ceased trading, leaving more than 20 million villagers jobless and forced to return to their homes. In addition, around 20 million babies were born in the country each year. As a result, China had experienced a great downward strain on its economic growth since the third quarter of 2008. Many enterprises, especially in labour-intensive industries and the export sector, had seen production severely affected and many had been forced to reduce production or shut down altogether, with significant job losses. Nevertheless, the unemployment rate had remained below 4.2 per cent. By maintaining a reasonable standard of living for its 1.3 billion people, China had kept its social stability, which in itself was a contribution to humanity as a whole.

The speaker added that over the years, the Government had implemented a series of plans and policies in employment promotion and had made great efforts to optimize the labour market and promote equal employment. However, trade unions had noted that, on issues such as narrowing the employment gap between rural and urban areas, promoting the employment of vulnerable groups and disclosing labour market information, the Government could intensify its efforts and perform better.

With regard to the impact of the financial crisis and the grave employment situation, he emphasized that the social partners should play an active role in formulating national economic and social policies. China’s trade unions had spared no effort in taking specific measures to stabilizing employment and safeguarding workers’ right to work, including participating in the formulation of a more proactive employment policy with a view to ensuring workers’ right to choose their work exploring the unions’ organizational advantages by offering the unemployed skills training opportunities and job services through over 2,000 training centres and 1,800 job agencies run by the trade unions, implementing assistance campaigns for tens of millions of rural migrant workers, extending aid to workers in need and launching an employment action programme for graduates. At the same time, a campaign had been initiated encouraging enterprises to refrain from cutting wages and dismissing workers, and in this regard a comparatively comprehensive law enforcement monitoring mechanism had been established. So far, some 321,000 supervision bodies had been created. The trade unions would continue to urge the Government to fulfil its responsibilities, particularly with regard to Convention No. 122.

In conclusion, the speaker stated that the global economic crisis had led to the closure of many enterprises and the loss of millions of jobs, posing a great threat to social stability. Implementation of international labour standards would undoubtedly promote the building of a sound economic order and stimulate economic growth. The ILO had made great efforts and an active contribution by promoting ratification and implementation of its Conventions. China’s trade unions would continue urging the Government, in its efforts to implement Convention No. 122, to listen to the various parties, actively pursue employment policies and strengthen social dialogue so as to achieve decent work for all China’s workers.

The Employer member of China indicated that China was a highly populated country in transition, and that the recent increase in laid-off workers constituted a major challenge. The Government had adopted a series of measures to promote employment and had implemented active employment policies to stabilize employment, create conditions for employment, and foster development of Chinese enterprises and sustainable development of the national economy. The China Enterprise Confederation (CEC) had also made considerable efforts to stabilize employment. First of all, it had actively collaborated with the Government and workers’ organizations with respect to trade policies, by underlining problems faced in enterprises in terms of employment and by participating in the formulation and implementation of employment policies. Secondly, the CEC attached great importance to its social responsibilities and had thus promoted vocational skills training of workers, the upgrading of knowledge of managerial staff, and the training of farmers. The CEC had also sought to explore the internal capacity of enterprises to ensure that workers would not be laid off. Thanks to the stimulus package provided by the Government, the Chinese enterprises had been able to provide employment to an increasing number of workers. For example, 200,000 new jobs had been created for internal migrant workers and new college graduates.

The Worker member of France said that the application of Convention No. 122 by China took on a particular importance in the context of the global economic crisis. There existed, in times of crisis, a certain tendency for worker protection to be sidelined. Nevertheless, China had recently seen various positive developments: an act defining the employment relationship had been in force since 2008. It carried the obligation to issue written employment contracts and provided, inter alia, for sanctions against employers who failed to respect the rights of their workers, particularly in the event of dismissals. The Government, through the National Human Rights Action Plan 2009–10, had made certain commitments concerning the right to work, the right to a minimum standard of living, the right to health, the right to social protection, the right to freedom of expression and guarantees for the rights and interests of peasants. When it came to implementing this legal arsenal, however, problems arose. Many enterprises were using the crisis as an excuse for mass redundancies. The central authorities had authorized local authorities to freeze the minimum wage, suspend payment of social benefits and deregulate working hours or wage calculations. The Government should instead apply existing legislation, making use in particular of real and effective social dialogue. The speaker highlighted the responsibility of employers in that regard. She stated that the pressure exerted by certain large groups did not encourage the Government to promote job security, social protection or a decent minimum wage. The speaker considered that, if multinational enterprises were capable of exerting a negative influence, they could also exert a positive one and improve wages and working conditions. This should be taken into consideration in the context of corporate social responsibility.

The Worker member of the United States considered that the implementation of Convention No. 122 by China raised serious concerns, including, in particular, four distinct but related points.

Firstly, according to Article 1 of the Convention, the employment policy should aim at ensuring that there is freedom of choice of employment and the fullest possible opportunity for each worker to qualify for, and to use his or her skills and endowments in, a job for which he or she is well suited, irrespective of race, colour, sex, religion, political opinion, national extraction or social origin. However, numerous reports by, inter alia, the ITUC, the US State Department and Human Rights Watch documented continued imprisonment, harassment and intimidation of workers who had expressed political opinions that differed from those adopted by the State. He therefore considered it crucial that the Government explained how its policies and activities would ensure conformity with Article 1 of the Convention, especially with regard to workers with diverging political opinions. This was all the more relevant given the importance of the current economic crisis.

Secondly, Article 2 of the Convention stressed the need to adopt the necessary measures for attaining the objectives specified in Article 1. Education was a critical component of fulfilling Convention No. 122, since workers who were not aware of the rights provided to them under the law, would not avail themselves of those rights. Education, however, meant more than merely issuing a law. It also meant making sure that the new law was understood by and accessible to all workers, regardless of region, origin or political opinion. The speaker thus called for a widespread public education process to disseminate information about the recently adopted legislation pertaining to employment, as recommended by the ITUC. In addition, he shared the view of the Worker member of France that enforcement was essential to the effective application of Convention No. 122 and deplored the lack of enforcement of employment laws in China.

Thirdly, according to Article 3 of the Convention, consultations constituted an essential element of the formulation of employment policies. However, consultations in China remained limited to the official State apparatus. The speaker believed that consultations should be sincere and broad and should include independent labour and human rights groups, as well as vulnerable categories of persons such as persons with disabilities. Sharing the view expressed by the ITUC, he urged the Government to ensure that all relevant groups and stakeholders, including workers’ organizations, women’s groups and migrant workers, were fully involved in the consultation and law reform process.

Fourthly, he considered that transparency was vital for all aspects of the Convention. He concluded that the Government should, therefore, provide the civil society, the workers and the media with timely reports on the progress of all issues relating to the implementation of Convention No. 122.

The Government representative of China thanked the Worker and Employer members, as well as the other members of the Committee for their positive remarks and encouragement on the efforts made and progress achieved by his Government in applying the Convention. Their understanding of the challenges and difficulties with which China was confronted and their advice and suggestions for enhancing the application of the Convention were highly appreciated. Due consideration would be given to the discussions of this Committee and the comments made by the Committee of Experts. He wished to emphasize, like the Employer members, that the Convention required the Government to pursue a policy by methods that were appropriate to national conditions and practices. The Committee could be reassured of his Government’s commitment to the full application of Convention No. 122 and its intention to continue its efforts to develop the economy, build a well functioning labour market system, strengthen skills training, improve social security and strengthen law enforcement mechanisms. His Government was ready to cooperate with the ILO and the tripartite members of this Organization in the global endeavour to promote decent work for all.

The Worker members observed that the policy and approaches developed by China in the field of employment were of crucial importance for Chinese workers and for the whole world during this period of financial crisis. They consequently asked the Government to do the following: (1) to continue to provide information on employment policy, measures taken and results achieved as regards the creation of more stable employment opportunities, improvement of the residence and work permit system, improvement of the situation of persons with disabilities and other vulnerable groups, organization of re-employment and vocational training of workers in the situation of economic restructuring, strengthening of the effective application of the labour legislation in order to attain decent work and decent wages for all workers, as well as the establishment of an efficient social security system and accessible health care facilities; (2) to continue to assess the impact of the new legislation, such as the new Labour Contract Act adopted in the beginning of 2008 and the new Regulations concerning the employment of persons with disabilities adopted on 1 May 2007; and (3) to continue to describe the role of social dialogue and trade union participation in that context.

The Employer members noted with interest the important role that job creation policies were playing in China’s macroeconomic policy. Recalling that the Convention set out a framework for the development of an active employment policy according to national conditions, they encouraged the Government to continue to develop and implement policies promoting full and productive employment and to include the social partners in this regard. Finally, the Employer members were pleased that the Government was prepared to communicate a full report regarding its policies to promote full and productive employment and the progress made in relation to achieving that goal.

Conclusions

The Committee noted with interest the detailed information supplied by the Government representative, as well as the tripartite discussion which ensued, addressing the measures taken in response to the financial crisis, to support employment by stimulating growth through active labour market policies as required under Convention No. 122.

The Committee welcomed the information provided by the Government on the situation of the labour market and its commitment to ensure that at least one member of every family was employed. The Government indicated that the registered urban unemployment rate in 2008 stood at 4.2 per cent and each year, the country had 24 million jobseekers in the urban areas and an additional 10 million rural workers who stood to be transferred to the cities to seek work causing an extremely high employment pressure on the labour market. The Government also reported on the measures taken to develop a unified labour market and ensure a public employment service, to strengthen skills training and workers’ employability, to improve social security and extend health care schemes, and to enforce the recently adopted legislation on labour contracts and employment promotion, which provided a framework for the achievement of full employment. In reply to the request by the Committee of Experts, the Government also provided indications on the emergency-response measures and special employment programmes implemented to recover productivity and stabilize employment in the Sichuan province, which was stricken by an earthquake in May 2008.

The Committee recalled that it was essential for the purposes of achieving the objective of full and productive employment to fully consult with the social partners and persons affected by the measures to be taken such as representatives of the rural sector and other stakeholders, so as to secure their full cooperation in the formulation and implementation of employment policies. The Committee requested the Government to provide, in its next report, information on the results achieved in terms of employment promotion through the implementation of the Labour Contract Act and the Employment Promotion Act. The Government was also requested to provide information on the results achieved by the measures taken to integrate vulnerable workers, such as workers with disabilities and workers that were laid-off as a consequence of the economic crisis, in the open labour market. The Government was also invited to include other relevant information on the measures taken to generate decent and sustainable employment, the efforts deployed to collect reliable labour market data, plans for the extension of social security and health care and the steps taken for the revision of the residence and work permit system with a view to achieving a unified labour market. The Committee also invited the Government to report on the impact of the measures taken to support sustainable enterprises, particularly small and medium-sized enterprises, and to foster vocational training and educational policies to match the demands of the labour market.

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The Committee notes with interest the detailed information provided by the Government in September 2009, in reply to the tripartite discussion that took place in the Conference Committee in June 2009 and to its previous observation.

Articles 1 and 2 of the Convention. Formulation of an employment policy. The Committee notes that the Government pursues long-term strategies and policies for employment promotion, prioritizes employment expansion in the socio-economic development and endeavours to achieve a healthy interaction between economic development and employment generation. The Government has devoted its attention to developing labour-intensive and tertiary industries, private enterprise and enterprises with foreign investment, small and medium‑sized enterprises (SMEs), self-employment and flexible forms of employment. To ensure that job creation is placed at the centre of macroeconomic policies, the authorities have established interdepartmental employment working groups for policy coordination. A joint ministerial meeting system which was headed by a vice-premier brought together representatives of more than 20 ministries. Active employment policies are being adopted, focusing on tax reduction, microcredit and interest subsidized loans for business start-up and self‑employment; hiring incentives such as tax reduction and social insurance contribution subsidies for enterprises that recruited unemployed people; public job‑creation schemes for hard-to-place workers; and targeted employment assistance programmes to ensure every family had at least one member in employment. The Government acknowledges the long-term employment pressure that they suffer due to factors such as a large population, industrialization, urbanization, economic restructuring and the comparatively low quality of the labour force. The Government also states that, every year, China has 24,000,000 jobseekers in urban areas and 10,000,000 rural workers yet to be transferred, resulting in a degree of employment pressure not experienced by any other country. In its report, the Government indicated that, since 2003, over 10,000,000 jobs have been created and more than 8,000,000 workers have been transferred from rural areas each year. In 2008, registered urban unemployment stood at 4.2 per cent. The Committee invites the Government to include in its next report information on the impact of the measures mentioned to generate employment.

Measures taken in response to the global crisis. The Committee notes that the crisis has especially affected the exporting sector and SMEs and that migrants and new labour entrants have been among the most affected. In its General Survey of 2010 concerning employment instruments, the Committee noted that the State Council had adopted Notification No. 4 in 2009, which deals with employment issues under the economic situation, and other documents which deal with facing the current economic situation and stabilizing the labour relationship (General Survey, op. cit., paragraph 620). Among the measures taken to respond to the crisis, the Government launched stimulus packages that focus on infrastructure, public works, rural development investment and support for labour-intensive industries, particularly SMEs and the service sector. Enterprises have been allowed to postpone or reduce payment of social insurance contributions and have also received subsidies. The Committee notes that social dialogue is being promoted as a tool to respond to the crisis. The national tripartite mechanism jointly issued the guidance on how to face the current economic situation and to stabilize the labour relationship, to encourage and guide enterprises and workers in stabilizing job posts and avoiding lay-offs as much as possible, by taking, through consultations, measures such as wage adjustments and flexible working time. The Committee notes the importance of genuine tripartite consultations to confront and mitigate the effects of the global economic crisis. The Committee invites the Government to provide in its next report information on the participation of the social partners in the design and implementation of an active employment policy to overcome the negative effects of the crisis.

Impact of legislation on employment creation. The Government indicates that the implementation of the Labour Contract Law has brought an increase in employment (reaching 93 per cent in 2008), and a decrease in the tendency of signing short-term contracts, which has increased workers’ stability in employment. The implementation of the Labour Contract Law has also resulted in an increase in the number of people signing up for social security. The Government also states that the Employment Promotion Act has translated active employment policies into law, providing powerful legal support for achieving full employment. The Committee invites the Government to continue to provide information on the impact and results achieved in terms of productive employment creation and the improvement of employment security for workers through the implementation of the Labour Contract Law and the Employment Promotion Act.

Vulnerable groups. The Committee notes the different employment policies, plans and actions developed to tackle the consequences of the devastating earthquake in Sichuan (May 2008), including employment assistance and support policies to recover production and stabilize employment. According to the data provided by the Government, up to March 2009, the supporting localities had supplied information on over 1,170,000 job opportunities in the areas affected by the earthquake, helped 105,000 workers find employment through remote job-changing employment and direct employment by disaster‑relief reconstruction projects, assisted over 1,267,000 workers to find employment on the spot or nearby and 308,000 workers were transferred from Sichuan through organized labour migration. The Committee also notes that the Emergency-Start and Improve Your Business (E-SIYB) was launched to support SMEs recover production in the area and rural workers to create business in the cities of Chengdu, Deyang and Mianyang. In its previous comments, the Committee noted the regulations adopted to promote employment of people with disabilities. The Government further informs that it has formulated a series of accompanying policies and measures in order to further assist people with disabilities and promote their employment, including special services, improvement of employment services and training to help them start their own businesses and self-employment. The Government has also adopted specific measures for rural workers with disabilities to increase their employability. At the end of 2008, new employment had been found for 368,000 workers with disabilities in the urban areas and 17,171,000 rural workers with disabilities were engaged in active production. The Committee invites the Government to continue to provide information on the impact of the measures taken in order to promote productive employment for vulnerable categories of workers. Please also include in the next report data on the situation and trends of the active population, employment, unemployment and underemployment disaggregated by sector, age, gender, in particular for vulnerable groups such as young persons, women, people with disabilities, rural workers and ethnic minorities.

Ensuring re-employment of laid-off workers. With reference to the measures to enhance the employability of workers that had been laid off by state‑owned enterprises, the Government indicates that between 2003 and 2008, over 30,000,000 workers had realized work through different channels. The Government has designated occupational training institutions to carry out flexible and diversified trainings and has launched the Re-employment With Skills project, which expected to train 4,000,000 workers per year. Between 2006 and 2008, 68 per cent of the 18,880,000 workers who had participated in the re‑employment training had found work. The Committee notes that companies that hire older workers receive subsidies and that special attention is paid to older workers in the 40–50 age group. The Committee wishes to continue to receive information on the measures envisaged to improve the insertion in the labour market of the remaining workers affected by the lay-off by state-owned enterprises.

Consistency and transparency of labour market information. The Government reports that up to November 2008, seven labour surveys had been conducted. Nevertheless, the complexity of the labour market is not entirely reflected. The Committee notes that the Government is exploring ways to improve these survey methods to enhance the results afforded by them. The Committee noted, in the 2010 General Survey, that the China Enterprise Confederation, through its membership network, is gathering information regarding recruitment, management of human resources and vocational training from companies (General Survey, op. cit., paragraph 80). The Committee recalls the importance of compiling and analysing up-to-date statistical data and trends as a basis for deciding measures of employment policy. The Committee wishes to continue to receive information on the progress made in order to obtain accurate data and how it is being used to formulate and review employment policies.

Constructing a unified labour market. The Committee notes that the reform in the household registration system is steadily advancing and that the reform aims at achieving an integrated management of residence permits for the migrant population. The Government is relaxing the requirement for rural workers who already have stable employment and residence in cities and townships. Efforts are also being made to actively develop village and township enterprises and the county-level economies to increase job opportunities for the rural labour force. The Government informs that it intends to increase efforts to ensure a unified urban–rural labour market and implement the Employment Promotion Law in greater depth so as to accelerate the establishment of an employment policy that embodies equality between urban and rural areas. The Committee invites the Government to provide in its next report information on the impact of the measures that are being implemented in order to ensure that workers enjoy the same rights and obligations in a unified labour market. Please provide further information on the projects launched to unify employment management and the results achieved by the employment services in providing jobs for rural workers seeking employment in cities. The Committee hopes that the measures to be taken will succeed in unifying the labour market and invites the Government to include an evaluation on how a balanced growth between economic development and employment has been achieved among the different regions of the country.

Extension of social security and healthcare. The Government indicates that social security coverage is being expanded to cover more people, particularly rural migrant workers and workers in precarious employment, and that the establishment of a basic medical insurance system is being accelerated. The Government further reports that from 2009 to 2011, governments at all levels were expected to invest around US$120 billion in improving medical insurance and the medical service system. The Government expects that by 2010 every one of the country’s 1.3 billion citizens will enjoy full health insurance coverage. The Committee invites the Government to include in its next report updated information on the matter and its impact on creating lasting employment.

Strengthening employment services. The Government indicates that in 2008, 99 per cent of the urban neighbourhoods and 80 per cent of towns have set up public employment services that provide assistance and job placement services and have helped 20 million people find work. The Committee recalls the key role that efficient employment services play to maintain full employment and to secure the needs to workers and enterprises (General Survey, op. cit., paragraph 202). In 2008, 10,000 private employment agencies operated in the country. The Committee notes that within the efforts to complete and improve the employment services that cover both rural and urban areas, pilot projects for the establishment of county- and town-level public employment service systems were initiated. In 2009, another programme was launched to provide internships for 3 million college graduates, and there were plans to help 1,000,000 long-term unemployed workers to find jobs and assist 8,000,000 migrant workers to transfer to the non‑agricultural sector. The Committee invites the Government to report on the achievements made in strengthening public employment services and regulating private employment agencies. Please also provide information on the measures taken to ensure cooperation between the public employment services and private employment agencies and measures that the Government is taking to encourage private employment services to improve the quality of their services in order for them to fulfil their employment promotion functions.

Promoting small and medium-sized enterprises. The Committee notes the increase of channels to finance SMEs. The Government has also encouraged financial institutions to improve their services and increase their credit support for SMEs, including granting microcredits for individuals setting up their own business. In 2008, the Government issued the guidance on boosting the efforts to encourage start-ups for employment promotion and created a directorate to offer assistance to entrepreneurs which are starting up their businesses. The Committee notes that 82 cities have been selected to pilot a new initiative of Start-up Oriented City. The Committee invites the Government to include in its next report more information regarding these pilot initiatives and information on the impact of these measures on employment creation. Please also inform on the measures taken in order to facilitate procedures to start-up business and on the efforts made to create an environment conducive to the creation, development and sustainability of SMEs.

Vocational training and education policies. The Government intends to provide non-agricultural occupational training to 40,000,000 rural workers through the Employment-With-Skill for the Rural Labour Force Programme. Between 2006 and 2008, 26,500,000 rural workers have received training. In addition, some localities have issued training coupons and opened training accounts in an effort to encourage rural workers to participate in trainings. The Committee also notes that the Ministry of Human Resources and Social Security implemented a special occupational training programme in 2009–10 to provide “tailored training” to meet the specific job requirements of enterprises, so that rural workers may walk directly into the job. The Committee also notes that, to assist laid-off workers and the rural labour force re-enter the labour market, the Government designated occupational training institutions to carry out flexible and diversified trainings. The Committee also noted in the 2010 General Survey that trade unions at various levels had set up vocational training institutions (General Survey, op. cit., paragraph 176). The Committee invites the Government to include information on how the human resource development policies are coordinated with employment policies and on how the Government is strengthening the coordination between vocational institutions. It also welcomes information on how the local entities and social partners participate in the design and implementation of training policies and programmes.

ILO technical cooperation. The Committee notes that the ILO’s SIYB Programme completed activities in areas of product development, quality control and development of trainers. It also notes that the technical assistance provided under the UN Millennium Development Goal, with the ILO as the leading executive agency, expects to improve the content and implementation of the young peasant workers services policy framework. The Committee invites the Government to provide information on the results obtained through these projects and also on the results in terms of employment creation derived from the implementation of the Decent Work Country Programme (2006–10).

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

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.

Observation (CEACR) - adopted 2006, published 96th ILC session (2007)

1. In reply to the previous comments from 2004, the Committee notes the detailed information provided in the Government’s report for the period ending May 2005. It also notes the observations supplied by the International Confederation of Free Trade Unions (ICFTU) and forwarded by the Office to the Government in October 2005. The Government’s reply to the ICFTU’s comments was received by the Office in January 2006. The Committee has benefited from an extensive technical analysis from the ILO Subregional Office in Bangkok, which completed and updated the already comprehensive information contained in the Government’s reports and in the comments of the ICFTU. In this respect, the Committee notes the technical assistance that is being provided by the ILO on integrated employment strategies, job creation through enterprise development, enhanced employability for productivity and competitiveness, productive employment for local communities, equal opportunities in employment and decent and productive work for young people. The Committee wishes to be provided with further information on certain specific issues and asks the Government to provide in its next report further detailed information regarding the following points.

2. Formulation of an employment strategy. The Committee notes that, according to the Government’s report, China will continue to face the enormous challenge of placing some 10 million new entrants annually in employment and finding new jobs for 14 million laid-off workers. Economic growth estimated at 8‑9 per cent should create a little over 8 million new jobs, leaving a gap of 13‑14 million jobseekers without employment. Over 2 million laid-off workers are still in or have left re-employment service centres. Another 3.6 million will be laid off over the next three years. An additional 3 million workers from secondary operations will need to be placed in employment. Others who have been re‑employed are only in temporary jobs. An added challenge is to find suitable employment for college graduates and demobilized soldiers. Workers in temporary jobs and migrants from rural areas will also be looking for employment. The Committee notes that the Government has responded to the employment challenge by introducing a comprehensive set of new legislation and policy measures, including pilot programmes implemented in different provinces and cities to test new approaches to creating jobs and enhancing employability. The Committee notes that the fourth China Human Development Report, published in October 2005, highlighted the need to expand employment opportunities for the poor as the most effective way of reducing poverty: “the principle of ‘employment first’ should guide industrial policy, macroeconomic policy and regulatory policy”. In this regard, the Committee emphasizes the need for measures to ensure that employment, as a key element of poverty reduction, is at the heart of macroeconomic and social policies. It would appreciate being provided with further information on the extent to which economic growth leads to an improved labour market and a reduction in poverty levels. It would also appreciate receiving information on how the programmes in place have contributed to employment promotion within a “framework of a coordinated economic and social policy” (Article 2, paragraph (a), of the Convention).

3. Freedom of choice of employment. The Committee welcomes the ratification of the Discrimination (Employment and Occupation) Convention, 1958 (No. 111), and hopes that its implementation will strengthen efforts to ensure freedom of choice of employment and that each worker will have the fullest possible opportunity to qualify for and to use his/her skills, in the conditions set out in Article 1, paragraph 2(c) of Convention No. 122. It requests the Government to provide such information, with an indication of the measures adopted to ensure that the progress achieved is translated into an increase in the participation rate of women and ethnic minorities.

4. Consistency and transparency of labour market information. The Committee notes the statistical data provided by the Government in its report and the concerns expressed by the ICFTU regarding labour market information. The Government reports improvements in the collection and dissemination of statistical data, specifically the labour force survey that has been set up by the State Council, which will collect statistics for both urban and rural areas. The Committee also notes that efforts will be made to improve unemployment statistics so as to provide a viable basis for future employment policies and employment administration and services. The Committee asks the Government to provide an evaluation of the progress made in improving the labour market information system, with an indication of the manner in which the data have been used to determine and review employment policy measures (Article 2).

5. Unifying the labour market. The Committee notes that reforms are still required to the household registration system (Hukou System), the social welfare system and government employment policies. The Committee understands that, of the current urban population of 540 million, 160 million do not hold an urban Hukou, which impedes their ability to obtain productive employment. The Hukou System has also created barriers to the mobility of workers from rural to urban areas and therefore to a unified labour market. The Committee would appreciate receiving information on the ongoing process of dismantling of the household registration system (Hukou) in order to ensure labour market integration and a unified labour market.

6. The Committee recalls from its previous comments that the White Paper published in April 2004 included within the objectives of the Government’s policies improving the social security system. It notes that improvements include expanding its coverage and greater financial support. The Committee asks the Government to report in more detail on the progress achieved in extending adequate social protection to the entire population. The Committee understands that, among the laws currently under consideration are the Labour Contract Law and the Employment Promotion Law. In the Committee’s view, measures to promote full employment permit the Government to create an environment that is conducive to the generation of productive and lasting employment in conditions that are socially adequate for all concerned. It asks the Government to report on the manner in which the new legislative texts are contributing to the generation of productive employment and the improvement of employment security for workers.

7. Reinforcing public employment services. Referring to its previous comments, the Committee notes the progress made in the development of public employment services. At the end of 2004, there were 34,000 employment agencies, among which 23,000 were public agencies which provided annual services to about 19 million people with a 52 per cent rate of successful placements. The Committee also notes the efforts to improve employment services to migrant workers with the “Spring Breeze Operation” to provide free assistance to migrants returning from the countryside to find work in the cities. The Committee requests the Government to continue to report on measures taken by the public employment services to promote employment at each territorial division (province, prefecture, county and township levels). Please describe the measures taken or envisaged to ensure cooperation between the public employment service system and private employment agencies.

8. Measures to promote the re-employment of laid-off workers. The Committee notes that since 1998 the Government has provided financial assistance and additional support to workers that have been laid off from state-owned enterprises. In 2004, 5.3 million laid-off workers participated in re‑employment training, with a 71 per cent success rate in jobseeking. In 2004, the Plan for Re-employment Training was launched to promote the re-employment of laid-off workers. The Committee further notes the measures implemented in order to waive or reduce taxes encouraging enterprises to hire laid-off workers, and guaranteeing small loans to help workers to create self-employment and individually owned businesses. The Committee asks the Government to report on the results achieved through these measures to give greater support and assistance to laid-off workers for their re-employment. The Committee hopes the Government will be able to provide the results disaggregated by sex and age.

9. Promoting small and medium-sized enterprises. The Committee notes that the project “Dragon Chain” launched in 2003 has offered a range of business development services to small businesses, including training for business creation, project development, testing and guidance, credit services, follow-up and assistance. It further notes that the implementation of the ILO Start and Improve Your Business (SIYB) project has played a positive role in business creation and in promoting employment and re-employment. The Committee asks the Government to continue to report on the promotion of an enterprise culture and on the manner in which employment creation is promoted through small and medium-sized enterprises. The Government may also deem it useful to consult the provisions of the Job Creation in Small and Medium-Sized Enterprises Recommendation, 1998 (No. 189).

10. Vocational training and education. The Committee notes that the Government has increased vocational education and training efforts for the labour force in order to address the problem of the skills mismatch and to meet the demands of technology and modernization, relying on vocational training institutions and mobilizing enterprises and employers’ organizations. The Committee understands that a Conference on Vocational Education was held in November 2005 which set targets and general policy measures for vocational training and education during the Eleventh Five-Year Plan, with the number of skilled technical workers expected to reach 110 million. The Committee asks the Government to continue to provide information on the results achieved by the measures taken to coordinate education and training policies with prospective employment opportunities. It draws the Government’s attention to the Human Resources Development Convention, 1975 (No. 142), and the human resources development, education, training and lifelong learning policies contained in Recommendation No. 195 of 2004.

11. Consultation of representatives of the persons affected. The Committee notes the ICFTU’s concerns regarding the participation of all those affected by employment policy measures. It recalls the importance of involving in consultations the representatives of the persons affected by the employment policies adopted by the Government, with the aim of taking fully into account their experience and views. The Committee reiterates its interest in receiving detailed information on the frequency and results of the consultations to secure the full cooperation of representatives of the social partners, including representatives of the rural sector and of the informal economy in the formulation and implementation of employment policies (Article 3). It would be grateful if the Government’s next report also included details of the way in which the Government and the social partners have addressed the matters noted in this observation.

Direct Request (CEACR) - adopted 2004, published 93rd ILC session (2005)

With reference to its observation, the Committee requests the Government, in its next report, to continue to submit detailed information also on the following points.

1. General and sectoral economic policies. The Committee notes the priority given by the Government to the development of the tertiary sector, favoured due to its capacity for creating employment. It notes that efforts are being deployed to develop high technology enterprises, but also to highly labour-intensive enterprises. Please submit information on the expected or actual contribution different types of enterprises may have had for the creation of jobs. Please submit information on measures taken in order to favour a balanced rural development, both with respect to agricultural and non-agricultural activities.

2. Collection and use of statistics on employment. The Committee notes that analyses of the supply and demand of labour are henceforth drawn up and published in most large or medium-sized towns in the country and that they are used, in particular, for the development of employment and training programmes. Please continue to submit information on the collection and use of this information, and to describe the type of data collected.

3. Reinforcing public employment services. The Committee notes that measures have been taken to reinforce not only the public employment service, but also to encourage the development of other public or private employment agencies. Please continue to submit information on the type and scope of activities of the employment service. Please include information on measures taken or envisaged to ensure cooperation between employment services in the different regions of the country. Please describe the measures taken or envisaged to ensure cooperation between the public employment service system and private employment agencies.

4. Measures to favour re-employment of laid-off workers. The Committee notes all the incentives instituted to boost employment of laid-off workers, in particular of those workers who may have particular difficulties in finding new employment. Please submit any evaluation of results achieved through these measures. Please also continue to submit information on the volume of the reintegration training activities that are carried out for the benefit of these workers as well as the results achieved.

5. Promoting small and medium-sized enterprises. The Committee notes the various measures undertaken for the promotion of small and medium sized enterprises, including the grant of tax advantages or credit guarantees, as well as by the development of an infrastructure of relevant services. Please submit information on the results these measures have yielded in terms of sustainable jobs created.

Observation (CEACR) - adopted 2004, published 93rd ILC session (2005)

1. The Committee notes the Government’s report for the period ending May 2003 and the detailed information it contains in reply to the Committee’s previous request. The Government details in its report the various measures taken in order to tackle employment conditions characterized by increasing unemployment, in particular, in the urban areas; significant movements of the active population which have been held back too long by the planned economy; and an excess of unskilled labour coinciding with a scarcity of skilled labour. In June 2003, the country recorded almost 8 million registered unemployed in the urban areas, of which 3.5 million were workers laid off from state enterprises. The total number of unemployed was estimated at 24 million, and the yearly new arrivals in the urban labour markets at 10 million. A continued annual level of economic growth of 7 per cent should allow for the creation of approximately 10 million new jobs per year, but the supply of labour is expected to continue to exceed the demand for years to come.

2. Declaration of an employment policy. The Committee notes with interest the holding of the China Employment Forum in Beijing in April 2004. Organized jointly between the ILO and the Ministry of Labour and Social Security and with the active participation of the China Confederation of Enterprises and the All China Federation of Trade Unions, the Forum adopted a Common Understanding on elements of an Employment Agenda for China, which places the promotion of decent employment at the centre of economic and social policies in the country.

3. Furthermore, the Committee is aware of the publication, in April 2004, of a White Paper on the employment situation and policies in China. The active employment policy which is detailed therein, focuses on developing the economy and adjusting the structure for an active creation of job opportunities; improving the public employment service system and developing the labour market; getting laid-off persons back into the workforce; as well as improving the social security system and maintaining harmonious and stable labour relations. The focus is on improving the quality of the workforce through the promotion of various kinds of educational and training programmes, the establishment of a vocational training system, and the implementation of a vocational qualification certificate system. One chapter is devoted to the employment of the rural workforce and its orderly reassignment, while another addresses the question of employment of women and guaranteeing women’s right to equal employment, promoting youth employment and helping the disabled to find employment.

4. In the opinion of the Committee, these initiatives can but favour the pursuit of the major goal of full, productive and freely chosen employment, within a framework of a coordinated economic and social policy, and in consultation with representatives of persons affected, in accordance with the Convention. It invites the Government to continue to submit detailed information on progress achieved in this respect in order to meet the major challenge that the employment situation in the country represents. In this respect, the Committee requests the Government to include information on how representatives of all persons affected by the measures to be taken are consulted concerning employment policies, pursuant to Article 3 of the Convention. It recalls that, in view of their share of the active population, representatives of persons employed in the rural sector and in the informal economy should be involved in these consultations.

5. ILO technical cooperation. The Committee notes the indications provided by the Government in its report on the pilot project for promoting urban employment in the cities of Baotou, Jilin and Zhangjiakou, as well as on the activities of training the trainers in the context of the "Start your business" (SYB) programme of the ILO. It requests the Government to continue to submit information on the technical cooperation or advisory activities of the ILO concerning employment promotion and actions taken as a result thereof (Part V of the report form).

6. A request concerning certain other issues related to employment policy has been addressed directly to the Government.

Direct Request (CEACR) - adopted 2002, published 91st ILC session (2003)

1. The Committee notes the Government’s report received in September 2002 which contains information pertaining to the matters raised in the 2000 direct request. The Committee also notes the progress made under the Memorandum of Understanding signed in May 2001 between the Ministry of Labour and Social Security of China and the Office in order to promote, inter alia, strong social policies, justice and democracy in the field of employment. The China Employment Forum has been convened for April 2003 to provide an opportunity to enlarge on the dimensions of a sound employment policy and to consider implementation issues. The Committee requests the Government to include in its next report information on the action taken as a result of the advice received from the Office in designing and implementing an active employment policy within the meaning of the Convention (Part V of the report form).

2. Article 1, paragraph 2(a) and (b), of the Convention. The Government states in its report that as a means of continuing to develop the labour market and to promote vocational training, it has improved the professional skills and quality of the labour force. To further its objective of achieving an adequate level of employment, the Government is paying particular attention to the re-employment of workers laid off by state-owned enterprises and the unemployed. The Committee notes that the registered urban unemployment rate had increased to 3.5 per cent (6 million persons) at the end of 2000 and is expected to reach about 5 per cent within the next five years. In addition, another 3.9 per cent of the urban labour force (6.57 million workers) were laid off from state-owned enterprises and are seeking re-employment. Estimated underemployment in rural areas was 150 million workers, many of whom are migrating to urban areas in search of employment, often in the informal economy. Nevertheless, in 2001, China’s GDP rose by 7.1 per cent compared to 2000 (and 7.3 per cent in the first half of 2002). The Committee asks the Government in its next report to describe how the employment policy objectives are related to other economic and social objectives. Please supply information on measures taken to create employment by the promotion of entrepreneurship of small and medium-sized enterprises, including township and village enterprises.

3. The Government emphasizes in its report that a series of major advances were made to develop a standardized, scientifically based and modernized labour market, mainly involving networking, service functions, market management and operational mechanisms. At the end of 2001, information networks and labour market monitoring centres had been established in 17 provincial departments, analytical reports on labour market information related to labour supply and needs were being issued to the public on a regular basis in 91 cities and pricing information to guide wage-setting was being publicized in 87 cities. Some 26,793 employment agencies have provided employment services to 18 million persons. The Committee would appreciate further information on the progress made in improving the labour market information system and the use of employment services in order to ensure the better matching of labour supply and demand. The Committee asks the Government in this connection to include information on the measures taken  to coordinate education and training policies with prospective employment opportunities. Please also provide information on the results of the programmes carried out to facilitate re-employment, for instance, under the initiative to train "tens of millions in three years".

4. The Government indicates in its report that a pilot project to promote urban employment in three cities (Baotou, Jilin and Zhangjiakou) was set up to explore ways of encouraging laid-off workers to set up their own businesses by providing training in business initiation and financial support in the form of small loans. Please continue to provide information on the impact of the initiatives taken to support job creation by private entrepreneurship. The Government may deem it useful to refer to the provisions of the Job Creation in Small and Medium-Sized Enterprises Recommendation, adopted by the Conference in June 1998.

5. Article 5, paragraph 2(c). The Government indicates in its report that activities to highlight achievements by women were carried out in collaboration with women’s associations, such as the All-China Women’s Federation, all of which were helpful in ensuring equality and avoiding discrimination in employment. The Committee refers to paragraph 1 of this direct request and asks the Government to continue to provide information on measures taken to ensure that race, colour, religion, political opinion, national extraction or social origin are not permitted bases for discrimination in counselling people on employment options, in providing education and training, or in hiring practices. It also requests that the Government include in the next report information such as statistics on lay-offs and subsequent placement in freely chosen and productive jobs of persons falling within these categories.

6. Article 2. The Committee asks the Government to continue to supply information on the situation, level and trends of employment, unemployment and underemployment in China both in the aggregate and as they affect other vulnerable categories of workers such as young persons, older workers, rural workers and displaced state-owned enterprise workers. Please indicate how the labour market data collected have been used as a basis for deciding and reviewing measures of employment policy within the framework of a coordinated economic and social policy.

7. Article 3. The Government indicates in its report that the process of developing and implementing employment policies has always been carried out in consultation with representatives of the groups concerned by the policy measures, including trade unions and employers’ associations. The Committee highlights that this important provision of the Convention requires the involvement in consultations of Government authorities and of representatives of the persons affected by the employment policy measures to be taken. The aim of the consultations is to take fully into account their experience and views and secure their full cooperation in formulating and implementing employment policies. Representatives of the persons affected must include representatives of employers’ and workers’ organizations and also representatives of sectors of the economically active population, such as the rural and informal sectors. In view of the impact of the economic and social measures being taken by the Government on workers displaced from the rural sector and from state-owned enterprises, the Committee would appreciate receiving information on any consultations envisaged in those sectors on the matters covered by the Convention in the next report.

Direct Request (CEACR) - adopted 2000, published 89th ILC session (2001)

1.  The Committee notes the detailed information contained in the Government’s first and second reports. It notes with interest the extensive technical cooperation the Government has undertaken with the ILO, which demonstrates the high level of commitment the Government has given to employment promotion.

2.  Article 1, paragraph 2(a) and (b), of the Convention.  The Committee notes the substantial progress made in developing the economy and reducing poverty within a short period of time. The Government states that growth in employment has averaged 2.8 per cent per year, with growth in urban areas averaging 4 per cent. Employment was 56.3 per cent in 1997, and 56 per cent in 1998. Urban unemployment was 2.85 per cent in 1997, and 2.76 per cent in 1998.

3.  The Committee asks the Government to provide information on the outcome of the pilot projects in 100 cities to modernize the labour market, as well as the outcomes of efforts mentioned in the Government’s report to: establish re-employment centres for displaced state-owned enterprise (SOE) workers, develop SMEs, promote self-employment, undertake labour intensive public works, and make the employment service more proactive. The Committee also would appreciate continuing to receive information on progress made in the following areas: promoting more effectively labour intensive growth; ensuring that skills are appropriate for labour demand; extending social protections; supporting SMEs; removing policies which distort incentives, including tax and urban development policies; strengthening public employment services, especially for displaced workers; and improving vocational guidance.

4.  Concerning education and vocational training, the Committee notes that the Government has established minimum training standards for vocational training centres and other institutions which provide training. The Government also reports that it has created conglomerate training centres which are intended to integrate training and employment placement services. It also is exploring ways to use telecommunications to provide training to more participants and has established numerous training programmes targeted at particular groups. Please continue to provide information on the outcome of these efforts, and on training provided to displaced workers from the private sector. Please also provide information on any follow-up taken to the various ILO projects and workshops pertaining to improving links between training and employment.

5.  Article 1, paragraph 2(c).  The Committee notes the numerous programmes aimed at ensuring that women and people with disabilities are fully integrated into the labour market. Please provide further information on measures taken to ensure that race, colour, religion, political opinion, national extraction or social origin are not permitted bases for discrimination in counselling people on employment options, providing education and training, or in hiring practices, including statistics on the lay-offs and subsequent placement in new jobs of persons falling within these categories.

6.  Article 2.  The Committee notes the Government’s statement that employment policies are developed in the framework of coordinated economic and social policies and re-examined and readjusted regularly, resulting in new policies and programmes on a periodic basis. The Government also periodically holds regional and national conferences on employment. There is a national bureau of statistics and the ten-year census includes employment issues (a census is currently in process). In addition, the Ministry of Labour and Social Security collects statistics. Policies and programmes are evaluated on the basis of this information. Please continue to provide information on the outcome of these periodic reviews. Please also provide further information on the action taken as a result of the recent ILO review of labour statistics methodologies and statistical analysis.

7.  Article 3.  The Committee notes that through the National People’s Congress and the Ministry of Labour and Social Security the Government consults with workers’ and employers’ organizations, and with representatives of rural area workers. Please continue to supply information on the frequency and outcome of consultations, in particular consultations held with representatives of rural and informal sector workers.