South China's Guangdong Province is setting up an
unemployment benefits scheme to both protect workers from sudden
layoffs and help those who have lost jobs.
The system is to be in place by the end of the year.
The scheme will prohibit companies from randomly laying off
workers, create an unemployment warning mechanism and make sure
that jobless people can afford basic necessities and get access to
re-employment programs, said Zhang Xiang, a spokesperson for the
provincial labor and social security department.
"Sixteen cities have hammered out schemes following the
provincial guidelines, and the (labor and social security)
department is urging the remaining five cities to work out schemes
by the end of this year," he said.
The goal of the new system is to keep the unemployment rate
under control and nip any potential social disorder in the bud
without affecting economic and social development, he said.
Zhang said enterprises must report to and get permission from
the local government before laying off a certain percentage of
workers. Also, enterprises will not be allowed to lay off workers
if they cannot pay to compensate them.
And regional government bodies must set up contingency plans to
deal with a surge in layoffs.
"How well a city handles unemployment will be taken into account
in the assessment of city leaders' administrative performance,"
Zhang said.
One business owner said the market was the most efficient way to
regulate labor.
"For now, I'm more worried about getting enough employees rather
than laying them off," Pang Gujia, the owner of a toy-making
company in Guangzhou, told China Daily. "You know workers
are still in short supply in the Pearl River Delta."
He added that staffing decisions had to be left to the state of
the market.
"If an enterprise is on the verge of bankruptcy or shutting
down, it is not convenient for the government to prevent it from
laying off its staff," he said.
The system is part of the province's efforts to increase job
opportunities and get the unemployment rate under control. Other
strategies include free training programs for the unemployed and
the rural population, preferential policies like financial support
and tax incentives to encourage people to start their own
businesses and job-creation.
The province expects to cap the unemployment growth rate of the
urban population at less than 3.8 percent per year by 2010.
And Guangdong will create at least 1 million new jobs per year
in a bid to help 800,000 laid-off urbanites find new jobs and
transfer 800,000 rural laborers to cities.
The province created jobs for about 2 million people last year,
with the employed urban population surpassing 52,200,000, keeping
the unemployment rate at about 3 percent.
(China Daily May 14, 2007)