The Ministry of Labour and Social Security said the country's 28 million laid-off workers will be incorporated into the social employment insurance network in the coming two to three years.

Those workers currently retain employment relations with their bosses and receive financial compensation from local re-employment centres.

After the laid-off workers are accepted in the overall social employment insurance network, China will use the term "unemployed" to define these people.

This is more than a simple change in name. It is a step towards the standardization of the country's employment policies.

China has seen its State-owned enterprises lay off large numbers of workers in recent years. The country practises an allowance system for laid-off workers due to the absence of an employment insurance system for them, who retain employment relations with their enterprises but lack access to employment opportunities.

But as China shifts to a market economy, a comprehensive nationwide employment insurance system is vital.

Workers need an insurance account -- with contributions from themselves and their employers -- to ensure a decent standard of living.

Such a system has been piloted in seven provinces and regions. Their experiences show it can be spread.

The ministry said the urban unemployment rate will be controlled at or under 4.6 per cent next year, with the creation of 9 million jobs.

But the huge number of graduates may increase employment pressures.

Statistics show there will be more than 3 million graduates from colleges and universities.

The Ministry of Education said China will recruit 8 per cent more college students year-on-year in 2005. This means employment pressures will continue in the years to come.

On the other hand, China has entered the stage of economic adjustment. Macroeconomic regulation, which aims to maintain sound and healthy growth, may slow gross domestic product growth to a certain extent.

This will also increase employment pressures.

The grave situation demands the improvement of labour insurance arrangements to ensure the rights of the unemployed.

(China Daily December 21, 2004)