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Sunday, August 29, 1999 Published at 17:27 GMT 18:27 UK


World: Asia-Pacific

Chinese jobless get benefit boost

Beijing is undergoing a massive clean-up for the anniversary

By Duncan Hewitt in Beijing

China is to increase unemployment benefits for millions of jobless workers to mark the 50th anniversary of the 1 October Communist revolution.

Unemployment has become perhaps China's biggest social problem in recent years as thousands of state-run factories close or reduce their workforces as part of economic reforms.

For workers accustomed to a job for life, it is a shock made worse by the lack of a nationwide social security system.

Worker protests


[ image: Late leader Deng Xiaoping introduced the reforms]
Late leader Deng Xiaoping introduced the reforms
Unemployment benefits are paid to workers either by the same impoverished companies that laid them off, or by often cash-strapped local governments.

There have been numerous cases of protests by workers who have not received their payments.

The announcement of the 30% increase shortly before celebrations of the 50th anniversary of the Communist takeover appears designed to defuse criticisms that the state is no longer looking after people once hailed as the backbone of the revolution.

Lay-offs

Labour and Social Security Minister, Zhang Zuoji, also announced an increase in payouts to another vulnerable group, retired workers, though no figures were given.

China's urban unemployment rate is officially estimated at only 2%, but most analysts put the figure far higher.

The news that 7.4m workers were laid off in the first half of the year and only 2m of them had found new work is an indication of the scale of the problem.

The minister acknowledged that more than 300,000 of those laid off had not received any benefits at all.

Analysts say that despite the planned increase, benefits in many cities will remain at barely subsistence levels and attempts to boost China's economy and create new jobs have so far yielded few results.



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