Many people continue to celebrate the Chinese experience, largely on the basis of the country’s rapid and sustained industrialization and export successes. Some still call it a socialist success story, often on the basis of Chinese party claims or Chinese foreign policy initiatives which are seen as supporting Venezuela, Cuba, or other countries under US pressure. Unfortunately very few people have actually looked at the accumulation process underpinning Chinese growth, in particular its consequences for working people. Paul Burkett and I have been doing some work on this, and I want to share some information that I think raises important questions about how we understand success and socialism.
The ILO has recently completed a major study of the Chinese labor market. Its results closely match work done by the IMF and the Asian Development Bank. The ILO created five employment categories for urban sector workers: TF is employment in traditional formal enterprises (state and collective enterprises); EF is employment in emerging formal enterprises (cooperative enterprises, joint ownership enterprises, limited liability corporations, shareholding corporations and foreign-funded enterprises); EP is employment in small-scale private registered enterprises; ES is employment in individual registered businesses; IRR is irregular employment (which includes casual wage employment or self-employment--often in construction, cleaning and maintenance of premises, retail trade, street vending, repair services or domestic services). Looking at the period 1990-2002, the ILO found that: TF Employment fell from 139.1 million to 79.7 million. EF Employment rose from 1.6 million to 25.7 million. EP Employment rose from 0.6 million to 20 million. ES Employment rose from 6.1 million to 23.5 million. IRR employment rose from 15.3 million to 95.3 million. Thus almost all the urban job creation over this twelve year period has been irregular. Not only are growing numbers of Chinese workers being forced into irregular employment, many others are suffering from outright unemployment. According to the ILO, “A major consequence of the reforms of the 1990s has been the emergence of open unemployment in China’s urban areas.” More specifically, the ILO estimates that the 2002 unemployment rate for long term urban residents was between 11-13 percent. This is a strikingly high rate given that the Chinese government counts as unemployed only those persons with non-agricultural household registration at certain ages (16-50 for males and 16 to 45 for females) who are capable of work, unemployed and willing to work, and have been registered at the local employment service agencies to apply for a job. And this rate has been kept down only by the fact that the labor force participation rate of urban residents fell from 72.9 percent in 1996 to 66.5 percent in 2002. Marty Hart-Landsberg
