Job creation should top govt's priorities to bridge income gap

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Last updated at: (Beijing Time) Monday, December 22, 2003

Job creation should top govt's priorities to bridge income gap

A leading economist has called for promoting steady economic growth to bridge China's widening income gap rather than unduly relying on the current social security system.

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A leading economist has called for promoting steady economic growth to bridge China's widening income gap rather than unduly relying on the current social security system.

Fan Gang, director of a Beijing-based national economy research center, said at the third economic annual conference Sunday that the government should focus on creating enough jobs for peasants pouring into cities.

"China's economy is not strong enough to endure a full-fledged social security system that is based on high expense," said Fan, noting a widening income gap is inevitable at the current stage when the agriculture-based Chinese economy faces globalization and the country is in the process of modernization.

He said Chinese peasants' income from agriculture had given way to manual work in cities as the major source for income increase, and enough jobs for them might be of great importance to narrow the income gap between the rich and poor and between the employed and unemployed.

More peasants in China prefer to undertake manual jobs in cities like washing cars, waiting table and serving as porters rather than working the fields back home.

It is estimated that some 300 million out of the country's 900 million peasants are now moving from rural areas for jobs in cities, and at the same time, bringing pressure upon some 100 million low-income urban workers.

"Only if society provides enough job opportunities in the process of steady economic development can China's labor resources retain value," Fan said.

"Attempts to bridge the income gap by simply raising the payment of low-income workers would become mere subsidies that the state finance can hardly afford," he said.

Under the current situation, Fan said, the limited social security resources should be mainly used to ease the possible social contradictions that may be triggered off by the income gap.

The government should increase investment in rural education and infrastructure construction, especially in remote areas, and establish a medical insurance fund for peasants, he said.

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