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At least 15 million people roughly the population of Beijing may not be able to find jobs in Chinese cities next year, when the economy is expected to grow at below 10 per cent, according to government think-tanks.

"We anticipate that employment pressure will remain high in 2007, when 25 million urban residents will be seeking jobs, with only 10 million vacancies available," said Yang Yiyong, deputy chief of the Economic Research Institute under the National Development and Reform Commission.

Adding to the unemployed, including laid-off workers, urban job markets will see at least 12 million new job-seekers next year, he said in the "2007 Analysis and Forecast on China's Economy," an annual report published by the Social Sciences Academic Press yesterday.

The urban registered unemployment rate stood at 4.2 per cent last year. No figure is immediately available for this year, but an official tally shows that 9.32 million jobs have been created in the first three quarters, surpassing the target of 9 million for the full year.

To ease the employment strain, the country would have to cap urban unemployment below 4.6 per cent, and vigorously expand the service industries, while funding re-employment efforts, Yang told China Daily yesterday.

About half of next year's 12 million new job-seekers would be college and vocational school graduates, Yang said.

The Ministry of Education said last week that pressure on the job market for university graduates would "obviously be grave" next year, when a record number of 4.95 million 820,000 more than the year before would leave campuses.

In rural areas, there are at least 120 million surplus labourers, who are seeking work in non-farming sectors. They are also migrating to the cities, further straining the supply-demand situation there, Yang said.

"The country's State-owned companies have slowed the pace in laying off workers, but at least 1 million workers downsized earlier have yet to find jobs, while more than 3.6 million lay-offs due to bankruptcy and closures would join the queue in the coming three years," he said.

To bolster employment, Yang's institute proposed that in addition to creating 9 million jobs next year, central and local finances should earmark at least 40 billion yuan (US$5.1 billion) to fund re-employment, including subsidizing the training of laid-off and migrant rural workers.

This year, the central budget has allocated 25.1 billion yuan (US$3.2 billion) to subsidize re-employment, an increase of 4.2 billion yuan (US$538 million) from the previous year.

Fan Jianping, director of the Economic Forecast Department of the State Information Centre, yesterday said the country should focus on developing the services sector and other industries that would spur consumption.

Fan said his research team believed that the odds are high China's economy would grow at 9.5 per cent next year.

The country posted gross domestic product (GDP) growth of 10.7 per cent year-on-year in the first three quarters, according to the National Bureau of Statistics.

On average, many Chinese economists and several world organizations predict China's economy would grow at 9.6 per cent in 2007. Some, however, put the rate slightly above 10 per cent.

"Compared with a faster growth rate, it is an optimized growth model that really matters when it comes to employment," Fan told China Daily.

The shift in the growth model from exports and investment to consumption would help create more jobs and bring more tangible benefits to residents, he said.

The anticipated slowdown in fixed asset investment next year would contribute to the slightly slower economic growth, according to the "2007 Analysis and Forecast on China's Economy."

The report said fixed asset investment would increase by 20 per cent next year, compared with the 26 per cent growth rate estimated for this year.

(China Daily 12/08/2006 page2)