China Vows to Support Job Creation After Virus Battered Economy

(Bloomberg) -- China’s top leaders have pledged to support job growth as the government battles high unemployment due to the blow the coronavirus dealt the economy.

A meeting on Wednesday of the country’s State Council chaired by Premier Li Keqiang vowed to broadly support job growth, including for part-time and “flexible” employment, according to a government statement. China’s cabinet said it would provide subsidies, loans and tax incentives to encourage entrepreneurship among key groups, such as migrant workers and recent college graduates.

Li reiterated that the employment situation in China is “severe” after the coronavirus outbreak shut large portions of the economy for months earlier in 2020. The surveyed urban unemployment rate rose to a record 6.2% in February before inching down to 5.7% in June. The government is aiming for “around 6%” for this year but that figure doesn’t count many migrant workers from the countryside. China has a record 8.74 million recent graduates entering the job market this summer.

The cabinet meeting also urged local governments to ease restrictions on what it calls “flexible” jobs and to encourage self-employment. China recently broadened the definition of a job to include more flexible forms of work for graduates. Those starting their own businesses, such as opening online shops, or taking freelance jobs, like bloggers and e-sports players, will now be classified as employed, the education ministry said.

The Chinese economy -- the world’s second largest -- returned to growth last quarter, expanding 3.2% year-on-year after a 6.8% decline in the first quarter.

©2020 Bloomberg L.P.

With assistance from Bloomberg