[Employment in China: Challenges & Countermeasures] EP2: Stabilizing Employment by Supporting Enterprises

Employment has become one of the highlights of the two sessions this year. Since enterprises are the major force in creating jobs, they must be given support to stabilize employment in the context of epidemic prevention and control.

The Chinese government has issued a series of policies to help epidemic-hit enterprises, especially micro, small, and medium businesses and self-employed individuals, get through this challenging time and stabilize employment. By now, 90 policy measures in eight categories have been implemented.

On May 22, the government work report delivered by Premier Li Keqiang at the third session of the 13th National People's Congress in Beijing noted that the Chinese government will continue to strengthen the implementation of epidemic relief policies.  

To strengthen tax cut efforts, the government will continue implementing reductions of VAT rates and the share of employees’ basic old-age insurance paid by enterprises, and will make further tax and fee cuts of about 500 billion yuan, according to the report. With all the tax reduction measures, it is expected to see additional savings of more than 2.5 trillion yuan for enterprises throughout the year, said the report.

The country will reduce enterprises’ production and operating costs. For example, rents for state-owned premises will be lowered or exempted. In addition, efforts will be made to increase financial support to keep business operations stable. The policy allowing micro, small, and medium businesses to postpone principal and interest repayments on loans will be further extended.

As of the end of April, enterprises above designated size in China had an average production resumption rate of 99.1 percent and 94.3 percent of their employees had returned to work, basically reaching the normal levels.

In 2020, the government will strengthen the efforts of supporting enterprises and stabilizing employment, and place major focus on preventing and reducing the risk of large-scale unemployment.