ABSTRACT
We noted in Chapter 3 that employment growth in China’s manufacturing sector
has been slowing down for the past several years. A much smaller proportion of
the Chinese labour force is employed in industry than in the primary or tertiary
sectors.1 Process of industrial rationalization and restructuring led to this
situation long before China’s entry into the WTO. The initial strategy of
concentration on heavy industry (which is generally capital-intensive) during the
pre-reform period may have also been responsible for low employment
generation in the sector relative to its contribution to output. China’s policy of
setting up a few large ‘national champions’ (like the Korean choebel) to compete
with global industrial giants after accession may have also contributed to the
problem.
