Floaters, moonlighters, and the underemployed: A national labor market with Chinese characteristics

Abstract

A national labor market has emerged as one of the most fundamental institutional changes in the PRC. Foreign direct investment has played a direct role. The Chinese national labor market, albeit with noticeable distortions, has provided a stable and abundant supply of cheap unskilled or low‐skilled labor and subsidized skilled labor and professionals, and enhanced labor mobility and autonomy in general. The national labor market has been strongly blessed by Beijing, as it feels it can effectively rely on the hukou (household registration) system to stabilize the massive underemployment at a time of comprehensive dislocations caused by the advancing market economy. The sociopolitical impact of the national labor market, however, is mounting as urban unemployment rises, the numbers of floating laborers grow and become increasingly restless, and the PRC government has become more apparently pro‐employer at the expense of labor.