China Unveils 24-Point Plan to Boost Employment and Economic Growth

(Analysis) China has unveiled an ambitious 24-point plan to address unemployment and stimulate economic growth. The State Council’s recent announcement prioritizes job creation as “a bottom line” for economic and social development.

This comprehensive strategy aims to reverse weakening economic momentum and meet the annual “around 5 percent” GDP growth target.

The plan encompasses a wide range of measures, from job creation initiatives to income distribution improvements.

State-owned enterprises will take the lead in absorbing the workforce, fulfilling their social responsibilities. The government pledges priority support, including land allocation, for businesses that generate more employment opportunities.

A key aspect of the plan involves strengthening macro-guidance on wage and income distribution within enterprises.

The government aims to promote reasonable salary increases, addressing concerns about income inequality. This approach seeks to boost consumer spending and overall economic activity.

The plan also focuses on education and skills development. China will expand enrollment in science, technology, agriculture, and medicine programs.

The government will adjust major degrees based on market and industrial demand. It will implement a warning system akin to football’s red and yellow cards for fields with poor employment outcomes.

Recognizing the impact of emerging technologies, the plan addresses the challenges posed by artificial intelligence on employment.

China Unveils 24-Point Plan to Boost Employment and Economic Growth

The government will offer social insurance subsidies to individuals facing employment difficulties, including recent college graduates engaged in flexible work arrangements within two years of graduation.

The government’s strategy extends to improving transport and logistics. A working mechanism has been established to coordinate COVID-19 response with smooth transportation.

The plan ensures the efficient operation of trunk traffic networks and provides support for freight transport businesses. Financial measures play a crucial role in the 24-point plan.

The central bank has implemented a half percentage point cut to outstanding mortgage rates and the reserve requirement ratio for commercial banks.

A 0.2 percentage point reduction in the benchmark policy rate aims to spur lagging consumption. Employment statistics underscore the urgency of these measures.

The jobless rate for the 16-24 age group, excluding students, rose to 18.8% in August, up from 17.1% in July. This increase followed a record 11.79 million college graduates entering the job market.

The plan also addresses the needs of specific sectors. Value-added tax will be exempted on eligible revenues from express delivery services from May 1 until the end of the year.

Relending Quota

A 100-billion-yuan relending quota will support financing for transport, logistics, and warehousing industries.

To facilitate smooth logistics, the government will provide free COVID-19 tests for truck drivers during transportation.

Quick application and issuance of travel permits will be implemented nationwide, with inter-regional recognition. These measures aim to keep supply chains running efficiently.

Additional support includes temporary deferment of social insurance premium payments for businesses facing COVID-induced difficulties.

The proportion of unemployment insurance premium refunds for companies maintaining stable employment will increase to up to 90 percent.

The government will support localities to implement time-limited discounts on electricity consumption for industries facing special difficulties. China’s 24-point plan reflects a multifaceted approach to economic challenges.

By focusing on employment, education, logistics, and economic stimulation, the government demonstrates its commitment to stabilizing the economy and maintaining growth targets.

This comprehensive strategy aims to create a resilient and dynamic economic environment for China’s future, addressing both immediate concerns and long-term development goals.