Funder: Asia Development Bank & Chinese Government
Duration: May 11, 2009 to April 15, 2010

With a growing working population reaching over 744.32 million in 2003, China’s 11th five-year plan (2006-2010) places paramount importance on establishing and maintaining a proactive employment policy that seeks to increase job opportunities for all sectors of the population.  The Public Employment Service (PES) system, which initially emerged in response to China’s transition from a planned to a market-oriented economy, has since been developed into a nation-wide system to address various development needs.

The PES system operates at six levels ranging from the state to the provincial, municipal, county, township and community level.   PES organizations are public organizations that provide free employment services for the labour force.   These services range from providing advice on employment policies, laws and regulations to labourers, to brokering jobs, providing labour market information and analysis, administering unemployment benefits, providing vocational training, and offering special support to disadvantaged populations.  PES organizations also work with state and private sector employers, schools and training institutions.

This TA deals with special problems of remote areas and minority groups in the Western Region (WR).  The WR comprises more than 70% of China’s landmass but only 28% of the national population.   The economy is largely rural and agriculture based.   The area has a small population spread over large area.  Remoteness is a problem - lack of infrastructure and transportation services make provision of a PES challenging.  Lack of PES, in turn, leads to poor access to information and social, economic and cultural isolation.  Eighty percent of PRC’s ethnic minorities live in the WR.  Most of these engage in agricultural activities and women have less access to employment.  A culturally sensitive and gender responsive approach is critical for the region’s development and will be borne in mind throughout this TA.

Qinghai has been selected as a pilot for this project as it is considered a typical model province of the WR.   It accounts for 7.5% of China’s landmass and 4.5% of its population, or 5.3 million people.  Its economy is the smallest in the country.  More than 48% of the province’s population comprises ethnic minorities, including Tibetan (23%), Hui (16%, Tu (4%) Salar (1.8%) and Mongol (1.8%).  The female illiteracy rate is high at 35.9% and women are at a disadvantage in accessing basic social needs.  Increasing amounts of surplus labour in remote areas(further exacerbated by the current economic crisis) requires an easily accessible and user-friendly PES to provide employment opportunities and ensure labour security to sustain and improve the quality of life for labourers.  The unique conditions of this region will require special attention and a customized PES to meet the needs of the people.   This TA will serve as a case study and make recommendations for improvements to the PES for the rest of the Western Region

In a rapidly changing socio-economic climate, and an increasingly complex employment market, the role of the PES as an enabler and facilitator is ever more critical.  The PES needs to be improved to meet demands arising out of both of these areas, i.e. socio-economic issues related to labourers and demands placed by a dynamic economy and employment market.   Specific areas that FIT is addressing through this TAinclude:

1. A review of PES policy instruments and strategies and their implementation in Qinghai in order to identify gaps in practice.
2. Institutional arrangements, including a review of the current decentralization mechanisms and the public organizations that provide services.  The range of services provided will be assessed in order to determine both their effectiveness and efficiency as well as the extent to which they meet expressed demand in Qinghai, especially by the disadvantaged populations.
3. Organizational issues, such as the level of staffing, their capabilities and gaps that will need to be addressed to improve service provision.
4. Allocation of financial resources – whether these are adequate to meet current and projected needs.
5. Socio-economic obstacles faced by disadvantaged populations such as educational levels, language barriers, discrimination and lack of access to services in remote areas that act as constraints in the employment market and ways in which to address these.
6. Roles of other related government agencies and mechanisms for integration and coordination among these and PES organizations.
7. Scope for improving networks between PES organizations and employers, training institutions and other community resources such as women’s associations in order to streamline and facilitate access to services.