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Unemployment plagues super power China

Nation says the situation will remain stable
March 9, 2008 12:00:00 AM PST
China said Sunday it is confident it can keep urban unemployment below 4.5 percent this year even though millions of college graduates need jobs and exports might decline. China aims to create 10 million new jobs this year and to find employment for 5 million laid-off workers, said Labor and Social Security Minister Tian Chengping.

"The situation with employment this year is going to remain stable," Tian told reporters at the annual session of the National People's Congress, China's ceremonial legislature.

A document outlining the ministry's goals for 2008 targeted a 4.5 percent urban unemployment rate. Tan said he expected it to be lower but gave no details. It was 4 percent last year.

China's economy grew by 11.4 percent last year but its communist leaders have struggled to find jobs for millions joining work force each year.

The number of college graduates has risen sharply. About 20 percent of the 5 million graduates in 2007 had not found jobs by the beginning of this year, according to the Chinese Academy of Social Sciences.

Tian also defended a new law aimed to improve workers' rights amid complaints about unpaid wages and other abuses. Employers say it has raised their costs.

"One can have expanding employment and a good investment environment alongside protection for workers and harmonious labor relations," Tian said. "There is no contradiction."

Tian said critics, including foreign businesses and some of China's biggest tycoons, did not fully understand the law. He pledged to boost enforcement and communication.

Many businesses have said the law could force them to move to countries with lower labor costs, such as Vietnam.

Businesses also worry that exports could suffer from the economic downturn in the U.S.

The government has said, however, that slower growth could ease pressure for China's currency, the yuan, to rise in value. A rising yuan could hurt Chinese exports by making them more expensive for other countries.

Tian said 770 million Chinese were employed at the end of 2007. The economy created 12.04 million new jobs last year.

 

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