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China's Millions of Migrant Workers and the Economic Downturn

Posted by: Dexter Roberts on December 08, 2008

The plight of China’s hundreds of millions of migrant workers has lately been on my mind, as the world economy slows and more and more of the export factories of China’s south close down. As some of our recent reporting in BusinessWeek has shown, many migrant workers now are finding job opportunities dry up, unemployment is soaring in coastal provinces like Guangdong, and many are opting to head back to the countryside early this year—most normally will return to their hometowns just before Chinese New Year, which falls in late January this year.

The China Human Development Report for 2007/08 jointly put out by the China Institute for Reform and Development and the UNDP China, and released on Nov. 16, is a remarkable source of information and analysis on the social welfare of China’s migrant workers, and indeed all Chinese. The report is concerned with China’s record in providing employment, health care, pensions, and education for all Chinese. As the title of the report puts it: “Access for all: Basic public services for 1.3 billion people.” But given the precarious state of China’s urban migrants (they number as many as 200 million now, and given urbanization trends, could grow by another 350 million by 2025), the report has an eye-opening section just focused on this particular group of Chinese.

“The rights of migrant rural labourers and their families are not fully guaranteed; they get lower wages, lack basic social security and find it hard to provide their children with education,” the report states, pointing in particular to the continuing “hukou” or registration restrictions, that make migrant workers into second-class citizens in urban China. “The implications of these problems for sustainable economic development are enormous, as the rural population is still 60 percent of the total population,” the report continues. Now for some of the alarming statistics:

Only one-third of migrant workers have pensions, the report states, while only one-fifth have health insurance coverage. All told, 78.4% of migrant rural workers are not covered by any insurance at all. That is particularly alarming the authors point out, given that more than 35 million migrant workers are employed in high risk occupations including mining, construction, and the production of dangerous chemicals and fireworks. More than two-thirds of migrant workers do not go to the hospital because of high costs. Meanwhile, given the migrants inability to provide social welfare for their family members in the city, “few of them can afford to bring their families with them to the cities, resulting in groups of children, women and the elderly who are left behind,” the report states.

Not surprisingly, the report has much more to say—also alarming—on the plight of China’s rural poor. All told, a very timely report focusing on some of the real challenges facing China today—and with particular relevance given the growing problems facing China’s export sector and so its migrant workers.

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Reader Comments

Not sustainable economy

December 9, 2008 12:49 AM

Obviously China's economic policies are doomed for disaster in the long term. Migrant workers may still have places to go back and survive. What can happen if China creates urban working class people who have no place to go back when downturn hit. No place to live and no food to eat. There will be only one thing: riots. China is simply to big to copy Taiwanese economic development model which is export-oriented OEM manufacturing.


December 9, 2008 04:02 AM

well,I think maybe some of them will gain benefit from new policies in favor of the rural areas.

jae richards

December 10, 2008 09:07 AM

The nature of migrant creatures is to move to greener pastures when the current area no longer sustains their need for the basic amenities of life.

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BusinessWeek’s team of Asia reporters brings you the latest insights on business, politics, technology and culture from some of the world’s biggest and fastest-growing economies. Eye on Asia’s bloggers include Asia regional editor Bruce Einhorn, Tokyo reporter Ian Rowley, Korea bureau chief Moon Ihlwan, Asia News Editor and China Bureau Chief. Dexter Roberts, and Hong Kong-based Asia correspondent Frederik Balfour.

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