Job creation a priority for Chinese government

China’s State Council has issued a 24-point set of guidelines to prioritise job creation and prevent the risk of large-scale unemployment.

The country’s cabinet said employment was a top priority for economic and social development, pledging coordinated fiscal, monetary, industrial, price and employment polices to help China meet its full-year growth target.

The guidelines offered a comprehensive package of measures, ranging from job creation by different sectors to better income distribution, as well as increased protection for gig workers.

State-owned enterprises were also urged to fulfil their social responsibilities by leading efforts to increase employment opportunities.

The State Council’s document said: “We will strengthen macro-guidance on wage and income distribution within enterprises.”

As part of the raft of interest rate and policy changes, China’s central bank has announced half a percentage point cuts to the outstanding mortgage rate and the reserve requirement ratio – the amount of cash that commercial banks must hold as reserves.

A 0.2 of a percentage point cut to the benchmark policy rate was also confirmed by central bank governor Pan Gongsheng amid efforts to boost consumption, which is seen as a hinderance to China’s hopes of achieving its annual ‘around 5%’ gross domestic product growth target.

“With only one quarter left to reach its annual growth target, Beijing is seizing this final window of opportunity by intensively introducing policies to stimulate domestic demand in a short period,” said Peng Peng, executive chairman of the Guangdong Society of Reform, a Guangzhou-based think tank.

“Beijing has already softened its stance on the full-year growth target, and with limited time remaining, achieving the 5% growth goal appears quite challenging.”

Employment has been high on the list of priorities for policymakers this year, particularly after President Xi Jinping in May ordered officials to put it and job creation “at the forefront of their minds”.

Under the 24-point guidelines announced by the State Council, Beijing also said it would expand enrolment in science, technology, agriculture and medicine education programmes, while also adjusting major degrees based on market and industrial demand.

It would also implement a warning system for sectors with poor employment outcomes.

The document mentioned it would address the impact of the rapid development of artificial intelligence and other emerging technologies.

“It also aligns with Beijing’s strategy to leverage high technology for economic growth, as China plans to establish more tech majors in fields facing choke points from the West,” Peng added.

Beijing would also offer social insurance subsidies to individuals facing employment difficulties, including college graduates who have not secured stable jobs but have engaged in flexible employment within two years of their graduation.

China steps up efforts to boost domestic demand

Meanwhile, the National Development and Reform Commission (NDRC), China’s leading economic planner, has said it is intensifying efforts to spur investment and consumption in its bid to bolster domestic demand.

Specifically, the NDRC will continue to support government investment in guiding and driving social investment, while also encouraging private businesses to participate in major national projects, said spokesperson Jin Xiandong.

The NDRC will offer more high-quality projects to private investors and promote government-private investment cooperation, Jin said.

Concerning the boosting of consumption, Jin said the economic planner will adhere to an “employment-first” policy and explore more approaches to increase incomes, thereby enhancing people’s spending power.

The NDRC will also promote consumption in sectors such as culture and tourism, education, healthcare, elderly and child care, and housekeeping, Jin said.

China’s consumer market has maintained stable recovery this year, with retail sales of consumer goods rising 2.1% year-on-year in August, according to the National Bureau of Statistics. Earlier data from the bureau showed that the consumer price index, a main gauge of inflation, was up 0.6% year-on-year last month, quickening from the 0.5% increase in July.