In China, Despair Mounting Among Migrant Workers

China is facing its worst job crisis since it began market reforms 30 years ago. With tens of thousands of manufacturing companies collapsing, leading to major layoffs, the central government's $586 billion stimulus package is focusing on job creation and vocational training, rather than handouts.
China is facing its worst job crisis since it began market reforms 30 years ago. With tens of thousands of manufacturing companies collapsing, leading to major layoffs, the central government's $586 billion stimulus package is focusing on job creation and vocational training, rather than handouts. (Photos By China Photos/getty Images)
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By Ariana Eunjung Cha
Washington Post Foreign Service
Wednesday, March 4, 2009

YIWU, China -- Li Jiang was hungry. Huddled in the freezing rain with more than 1,000 other people at 6 a.m., he stood patiently in line hoping he had come early enough to get some of the free rice porridge steaming in giant cauldrons nearby.

It was an unfamiliar feeling for Li. For the past 11 years, he had been making a comfortable living on a steady stream of construction and factory jobs that afforded him fancy cellphones and other modern luxuries. But he was laid off two months ago, and it has been impossible to find work since.

"This is an unfair society," said Li, 27. "The government isn't giving much help, and there are too many bosses who are out to cheat us." It is the first time in his life, he said, that he has felt such deprivation.

Six months into what economists and labor experts say is China's worst job crisis since it began market reforms 30 years ago, many among the most vulnerable -- an estimated 20 million workers who lost their jobs after migrating from the countryside to cities -- are becoming desperate.

As tens of thousands of manufacturing companies have collapsed amid slowing demand due to the global economic crisis, the laid-off workers can no longer find jobs in the cities. For many, returning to their rural roots is not a possibility because their families' farmland has been sold off to make room for shopping malls, office high-rises and apartment complexes -- leaving them with no safety net. Even those lucky enough to have kept their farming plots have been hit hard by a drought -- the country's worst in 50 years, according to the government -- which has affected up to 80 percent of the land for winter crops.

"The drought has had a big impact on farmers. Some villages are out of food," said Lu Xuejing, a professor at the Capital University of Economics and Business in Beijing. The impact has been especially pronounced in the nation's northwest, in provinces such as Gansu, where high temperatures combined with sparse rainfall have dried up riverbeds and killed wheat crops. This convergence of factors has meant the unthinkable for a country that in recent years has enjoyed double-digit growth in gross domestic product: As many as 10 percent of China's 130 million migrant workers face what Renmin University professor Yao Yuqun calls "bread-and-butter issues." They are having trouble putting food on the table because "they no longer have farmland, and they lost their jobs in the cities," Yao said.

Food lines like the one in Yiwu recall the worst period in modern Chinese economic history -- the 1958-61 famine that resulted from the Great Leap Forward, when, as part of a plan to transform a largely agrarian society into an industrialized one, millions abandoned their farms to work in factories, leading to food shortages.

China is not in any danger of that happening again. Since then, the country has kept generous reserves of grains, pork and other staples, and it has an estimated $2 trillion in foreign exchange reserves that it can use to buy the food it needs from elsewhere.

The challenge for China's leaders is to ensure that no one goes hungry, without moving the country back to the iron-rice-bowl era, when the state guaranteed cradle-to-grave employment.

The central government has responded to the sharp economic contraction by focusing on job creation and vocational training rather than handouts with its $586 billion stimulus package. Some city and provincial governments have taken a different approach, handing out food coupons for the first time. They have also distributed vegetable oil and other essentials, but these programs are limited.

Meanwhile, China's social welfare system is a work in progress and will be one of the main items on the agenda this week at the annual meeting of the National People's Congress in Beijing. A proposal to create a universal safety net that includes unemployment insurance for all citizens was released for public comment in December, but it is yet to be implemented.

Wealthier citizens are trying to fill the gap between what the government is offering and the need they see in their neighborhoods, by starting soup kitchens and other charitable endeavors like the one in Yiwu.


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