Since this year, the growing downward pressure of the domestic economy has made the employment situation particularly grim. To this end, at the meeting in July, the Communist Party’s Politburo analyzed the current economic situation and proposed to stabilize employment, finance, foreign trade, and investment to tackle external changes and ensure stable economic operations effectively. From this，Politburo has ranked the stabilize employment as the first and most important task. In addition, the report of the 19th National Congress of the Communist Party of China also stated that employment is pivotal to people’s well-being, as the instability in employment will affect the standard living of people and may ultimately affect the social stability. From this perspective, stabilizing employment is to safeguard the social stability from the economic risk. China's employment situation is generally stable and improving, but there are changes and difficulties in maintaining stability, said Zhang Yizhen, Vice Minister of Human Resources and Social Security, at a regular policy briefing of the State Council on December 5. The Hong Kong media said the rare use of the phrase "difficulties in maintaining stability" reflected a grim omen in China's employment situation.

The reality also confirms the grim employment situation does happen in China. The internet industry is experiencing a downturn in its development. Since September, the news of Alibaba scaling back its campus recruitment program has caused an uproar on the Internet. At the same time, it has spread the news that Baidu and JD.com have stopped the social recruitment and the Tencent will lay off about 6,000 of its staff. BAT (i.e. Baidu, Alibaba, and Tencent), a representative of Chinese Internet companies, is a desirable place for job seekers. As we have seen every time, they have denied the rumors. After all, there has no company ever been willing to admit that it is layoffs unless it is really on the verge of bankruptcy. However, the research data from the human resources industry doesn't lie. According to big data from a recruitment platform, in the third quarter of 2018, the number of jobs in the IT/Internet industry decreased by 51% compared with the same period of last year. The second consecutive quarter saw negative growth in demand, and the contraction of jobs was much higher than the national average.

The layoffs in the Internet industry are visible, but the mass job losses in the manufacturing industry have not attracted enough attention. As the Apple's most important manufacturing base and sales market, China is sending out a series of employment signals: Foxconn, the contract manufacturing giant, has been reported to cut 340,000 jobs worldwide and cut RMB 20 billion spending in 2019. In November, a study of Tencent Technology found that Foxconn had less time for overtime work. According to a worker of Foxconn's Shenzhen Guanlan Technology Park, the queue time for a meal was more than 20 minutes during the peak period of 130,000 to 140,000 workers in the factory last year, however, since the number of workers has reduced to 70,000 to 80,000 recently, they don’t have to wait that long for a meal. "In the past, thousands of workers flowed in and out every day, but for now on, there are thousands of people are leaving every day, but the factory is not hiring anymore." On the other hand, due to plummeted orders, the glass lens supplier Bern Optical has been forced to lay off 5,000 workers, which led to a massive labor dispute. Flextronics Plastic Technology, a subsidiary of Flextronics Ltd., is in a tough spot, it can be observed through its 6 batches of "long holidays" within November 12 to February 1. It is worth noting that the economic downturn hit China's private enterprises the most. According to statistics, private SMEs contributed 80% of the employment, if the private enterprises fail, unemployment will certainly increase. The employment situation in other industries is also not optimistic. The semi-annual report of the brokerage industry showed that 9 brokers have laid off 4,186 workers, among them, the Oriental Landscape Co.Ltd. has laid off 30% of its staff; the CEO’s salary has been reduced from millions to less than RMB 20,000 per month; many researchers have transformed themselves as sales staff... After China’s stock market plunge in June 2018, the secondary market was sluggish, and the hardships of the financial industry were still behind. The shadow banking was rectified, the financing cost of real estate enterprises soared, and the financing of real estate enterprises has become more stringent than before. Thus, downsizing and layoffs became the first choice of real estate enterprises to survive: the senior officials of Centaline Property said frankly: "Now it is the elimination competition of 'queue up to die', the winner will be the one who has the strength to rank last."

It is also worth noting that there is still some time to go before the Chinese New Year festival, but many migrant workers have already returned home early. The main reason is that many factories have lesser orders so that the factories decide to let their workers have advance holiday rather than paying them wages with no production to produce. In fact, these workers are equivalent to losing their jobs in disguise. In addition, as new college graduates flock to the job market, the pressure on total employment will also increase. Lu Aihong, the spokesperson for the Ministry of Human Resources and Social Security, said recently that the number of college graduates in 2019 is expected to be 8.34 million, an increase of 140,000 over the previous year. The pressure on total employment is still very large, and the structural contradictions in employment are still very prominent. At present, the instability and uncertainties of domestic and foreign are on the rise, which will in turn affect the production, operation, and employment of some enterprises, hence, the employment situation is still severe and complicated. Therefore, it is necessary to take a step to coordinate the employment of various groups of people, expand employment channels, and strive to achieve higher quality and full employment of college graduates.

To this end, Premier Li Keqiang recently hosted the State Council executive meeting to identify targeted measures to further promote employment. First, those insured enterprises with stable employment are eligible to claim back 50% of the unemployment insurance premium through a fee reduction. The second measure is to support entrepreneurship to drive employment. The government will promote entrepreneurial employment through government financing guarantees and encouragement of entrepreneurial secured loans. Private enterprises, SMEs and micro enterprises are the main supply of employment, thus, all policies that supporting entrepreneurial employment should focus on them. Third, the participation in skills training should be encouraged. The government will support unemployed people to participate in various kinds of skill training and give training subsidies to qualified participants. The fourth is to timely release unemployment insurance benefits to eligible unemployed persons, and the basic medical insurance and other expenses that individuals should pay will be included in the unemployment insurance fund. Fifth, all localities should give higher priority to deal with the unemployment issue, and take appropriate, multiple measures to promote employment.

Judging from the recent development situation, the risk of unemployment in the country is increasing and the unemployment rate is approaching a danger level, we should pay great attention to it. Domestic economic policies are in urgent need of adjustment and it is also suggested that the government should introduce a large-scale stimulus policy to deal with domestic unemployment. According to the views of Anbound at the end of 2017, China needs a massive stimulus policy of RMB 30 trillion to 50 trillion in the future, such "drastic" proposal is actually a prejudgment after a rational analysis of China’s economic and social system by Anbound research team. The size of current China's economy has been greatly enlarged since the "RMB 4 trillion" policy was adopted, and it has exceeded RMB 80 trillion. This type of large-scale stimulus is more focused on systemic stimulus, which is different from precise regulation. Because China's economy is facing a systemic problem, precise regulation can only serve as a “blood transfusion” for specific fields, but it cannot stimulate the activity of the entire economic system. Therefore, comprehensive stimulus policies are needed to generate the “hematopoietic function” in the whole economic system. The core function of massive stimulus policy is to expand the market space, by expanding the market to create more demand, so that enterprises could make more money, and willing to recruit more and more workers. Therefore, social employment can settle down and lay a foundation for steady growth.

Final analysis conclusion:

The risk of unemployment in the country is increasing and the unemployment rate is approaching a danger level, we should pay great attention to it. Domestic economic policies are in urgent need of adjustment and it is also suggested that the government should introduce a large-scale stimulus policy to deal with domestic unemployment.