Fast economic growth has again proved effective in boosting the country's employment. However, to pursue sustainable development, the authorities should focus efforts on job creation that is in line with the country's energy-saving and pollution-reduction goals.

 

Latest statistics from the Ministry of Labor and Social Security indicate that the country has created 6.29 million new urban jobs in the first half of the year, accounting for 70 percent of the year's target.

 

Such strong employment growth is clearly a pleasant result of China's robust economic expansion.

 

It is also encouraging that the average income of urban residents increased 14.2 percent year-on-year while farmers earned 13.3 percent more. That means the strong momentum of wage growth will continue. It was reported that the total wages of urban workers in the country rose 13.5 percent annually between 2002 and 2006.

 

Expanded employment and rising wages are crucial to improving people's living standards. But the current rosy employment prospect does not guarantee any slackness in creating more lasting and decent jobs.

 

Labor shortages in China's coastal regions have been frequently observed in recent years. This temporary phenomenon seems in line with a long-term demographic curve that points to an end of labor oversupply in the foreseeable future.

 

Yet, at present, the country's employment pressure remains heavy. The amount of newly added laborers will average 20 million between 2006 and 2010 while there is still a surplus of some 120 million laborers in rural areas.

 

Moreover, the country's ongoing efforts to change the growth model means policymakers need to strike a balance between job creation and energy conservation and environmental protection.

 

Extensive growth of some energy-consuming and polluting industries used to be an easy way to absorb surplus laborers. But as the country tightens its energy and environmental standards, growth of such industries might be checked. And forced closure of industrial polluters may even add to local unemployment pressure.

 

Under such circumstances, the authorities should speed up efforts to create a favorable climate for the development of the service sector. A booming service sector is not only an ultimate answer to China's employment problem, but also a requirement for economic growth and social development.

 

(China Daily August 7, 2007)