How has Economic Restructuring Affected China’s Urban Workers?*

Using data from the China Urban Labor Survey conducted in five large Chinese cities at year end 2001, we quantify the nature and magnitude of shocks to employment and worker benefits during the period of economic structuring from 1996 to 2001, and evaluate the extent to which adversely affected urban workers had access to public and private assistance. Employment shocks were large and widespread, and were particularly hard on older workers and women. Unemployment reached double digits in all sample cities and labor force participation declined by 8 percent. Urban residents faced modest levels of wage and pension arrears, and sharp declines in health benefits. Public assistance programs for dislocated workers had limited coverage, with most job-leavers relying upon private assistance to support consumption, mainly from other household members.