migrant workers and economic growth in china slides courtesy of: prof. andrew watson university of...
TRANSCRIPT
MIGRANT WORKERS AND ECONOMIC GROWTH IN
CHINA
Slides courtesy of:
Prof. Andrew Watson
University of AdelaideLecture 10: Economic Development
Structure of Lecture
1. Background on development model before 1978
2. Reform and opening
3. Rural-to-Urban migrants in China
4. Social Consequences and sustainability
1. BACKGROUND
• Centrally planned economic growth
• Planned distribution
• Priority for industry
• Controls over labour
• Household registration and the dual population
2. REFORM AND OPENING
1. Opening• Foreign trade, FDI, foreign aid
2. Reform• Reducing planning• Introducing markets
3. Rural Reform• Land contracting• Free markets• Liberalisation of labour controls
Reform Outcomes
• Comparative advantage in labour-intensive manufactures
• Relative decline of agriculture
• Growth of informal sector
• Urbanisation
• Reduction in rural poverty
Economic growth 1981-2002(Source: World Bank, China: Promoting Growth with Equity, 2003)
GDP and employment growth 1978-08(Source: Li Shi, Beijing Normal University)
0. 0
200. 0
400. 0
600. 0
800. 0
1000. 0
1200. 0
1400. 0
1600. 0
1800. 0
1979
1981
1983
1985
1987
1989
1991
1993
1995
1997
1999
2001
2003
2005
2007
GDP growth
Empl oyment growth
Changes in employment structure 1978-08(Source: Li Shi, Beijing Normal University)
0. 0
10. 0
20. 0
30. 0
40. 0
50. 0
60. 0
70. 0
80. 0
1978
1980
1982
1984
1986
1988
1990
1992
1994
1996
1998
2000
2002
2004
2006
2008
Pr i mary
secondaryTer t i ary
%
Changes in employment structure 1978-08(Source: Li Shi, Beijing Normal University)
0
20
40
60
80
100
120
140
160
1989 1993 2001 2002 2003 2004 2006 2008
mi l l i on
year
number of rural mi grant workers, 1989-2008
3. DEFINING MIGRANT WORKERS
• Basis in the household registration (hukou) system
• Total numbers: around 230 million:– 150 million rural-to-urban migrants– 80 million workers in small rural enterprises
• Excluded from urban welfare
• Low wage levels
Characteristics • Gender structure: 65% male, 35% female.
• Age structure: average age 29; range 16-40.
• Educational level: better educated rural people; two-thirds have junior secondary level
• Mobility: 20% permanent; 60% mobile; 20% seasonal
• Generational change
Employment distribution
• Migrant Employment Structure by Sector (%)
Manufacturing 35
Construction 20
Services 10
Hotel and catering 6
Retail 5
Other 24
Role in total employment
• Migrant Employment in Total Employment (%)
All secondary sector employment
58
Manufacturing 68
Construction 80
Services 52
Income
• Income (2006 survey):• Average monthly income 946 yuan (about $150)• Males 1,068 yuan• Females 777 yuan• Wide regional variations• Half average urban wage• 50% below 800 yuan
• Urban/rural differential (2009)• Urban annual per capita disposable income Rmb 17,175
• Rural annual per capita income Rmb 5,153
• BUT income levels rising: • by 2009 average reached around 1,350 yuan
• Lewisian turning point?
Conflicts of interest
• Employer vs. employees
• Urban residents vs. outsiders
• Local government interests
• Local and central government
4. CONCLUDING OBSERVATIONS
• Over next 10 years labour costs will rise
• Social equity issues more urgent:– Migrant worker protests– Aging population– Unified social security system
• The shift towards higher capital intensity will continue
• BUT China will continue to maintain a significant advantage in manufacturing