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Tuesday, 7 March, 2000, 17:13 GMT
Chinese unemployment soars
Unemployed workers in Beijing
Nowhere to go: Unemployed workers in Beijing
By Duncan Hewitt in Beijing

China's minister of labour says some five million workers will lose their jobs this year as the country enters a crucial stage in its state enterprise reforms.

Zhang Zuoji said the country had 11.7 million urban workers unemployed at any one time last year, and it was becoming harder to find new jobs for the long term unemployed.

As China enters the third and final year of a massive programme to reform its state industry, officials say the number of companies making losses has been cut by almost half. But it's the workers who are paying the price.

Last year 6.5 million of them lost their jobs, minister Zhang told reporters, and he said another five million would join them on the scrap heap this year.

Man on bike
People are struggling to find work
Mr Zhang pledged that job losses on this scale would be a thing of the past within three years.

System under strain

But he gave a sense of the strains on the system: despite the establishment of a nationwide network of re-employment centres the proportion of laid off workers who found new jobs fell last year from more than 50% to around 43%.

Mr Zhang said healthy young people had good prospects of finding work, but many older laid off workers remained dependent on state support.

And he said that while China was striving to set up an urban social welfare system up to 700,000 unemployed people who needed welfare payments had not received them last year. Another 500,000 elderly people had not received their pensions on time or in full.

Jobless queues get longer
11.5m unemployed by end of year
700,000 jobless not getting welfare payments
500,000 elderly not getting pensions on time
Mr Zhang said this was partly because state companies, which are often still responsible for some welfare payments, did not always have enough money to pay.

He acknowledged that had caused social unrest in some areas and said central and local government would set aside more money this year to ensure that payments were made.

The minister's unusually detailed comments are a reminder of the scale of the problems China faces, particularly since the country's vast rural population, which is not covered by the social welfare system, is not included in the unemployment figures, and many analysts believe the urban unemployment rate too is being underestimated.
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