Urban Transformation in China

Gordon G. Liu, Aimin Chen

• Publisher: Routledge
• Year: 2017
• ISBN:
  9781351876377
• Edition: 1
• Topic: Politique et relations internationales
• Subtopic: Urbanisme et développement urbain

This book provides a general description and evaluation of the process of urbanization in China and the urgent challenges facing the Chinese government. Urban Transformation in China examines the changing pattern of China's urban population and the determinants of these changes, including an analysis of the spatial structures of China's cities and industry and an assessment of urban productivity growth and the role of mega cities in national development. The book's coverage encompasses both academic and policy perspectives. With its sister volume Urbanization and Social Welfare in China it provides a comprehensive and multidisciplinary overview of the country's urbanization process.

PART I: CHARACTERISTICS OF CHINA’S URBANIZATION

CHAPTER 1
CAN AGRICULTURAL LABOR ADJUSTMENT OCCUR PRIMARILY THROUGH CREATION OF RURAL NONFARM JOBS IN CHINA?

D. GALE JOHNSON*

The University of Chicago

Abstract

If China’s rural families are to participate fully in the future economic growth there must be a large reduction in the number of farm workers. In order to accommodate the reduction needed over the next three decades, there will need to be 12–15 million new non-farm jobs created every year. Township and village enterprises have provided roughly 100 million new jobs since 1985, but in recent years there has been little increase in such jobs. One problem is that these enterprises are very small-industrial enterprises with an average of about 11 workers. As the Chinese economy becomes more competitive, such small enterprises have experienced increasing difficulty in maintaining employment, let alone providing millions of new jobs each year. Where can the new jobs be provided? Due to continuing restrictions on migration, it is unlikely that many will become available in cities. An alternative is proposed, namely to promote the development of enterprises in one or two towns or small cities in each county. The workers could then continue to live in the villages and commute to their jobs on a daily basis. The advantage of this alternative is that it requires far less capital than if the same number of workers migrated with their families to cities.

The curse of being born on a farm in an economy that is undergoing economic growth is that the odds are great that you will have to choose to be something other than a farmer. Of course, an even greater curse would be that if significant economic growth did not occur, you would have little choice but to remain a farmer, and you would be poor all your life.

The people now living in rural China will face many difficult adjustments in the years ahead – many hard choices must be made. These choices will be based on emerging new opportunities; fortunately fewer and fewer will be faced with choices based on escaping poverty. Should one migrate to a large city? Would one be permitted to do so? Should one start a business in the village or a small town? Should one give up his or her land use rights? Should one try to find a job in a local TVE? And then give up farming? Or remain as a part-time farmer? These are not easy decisions, lightly made. It is not that only a few people will have to make such decisions but over the next three decades nearly every rural adult will face such decisions and more than three fourths of them, hopefully, will decide to leave farming entirely or in large part. This is what economic growth will require of the people of rural China over the next several decades if they are to share in it.

Labor Adjustment That Has Occurred

China has already undergone very significant adjustment of its rural labor force. In 1952 87.5 per cent of its population was rural; by 1978 the percentage had dropped only slightly, to 82.1 per cent. Since 1978 the adjustment has been much more rapid with a decline to 69.6 per cent (SSB, 1999). However, the shift in employment of rural people out of the primary sector has been significantly greater than the change in the rural population.¹ In 1952 employment in the primary sector was 83.5 per cent of national employment; in 1978 70.5 per cent and in 1998 49.8 per cent, according to the official data (SSB, 1999, p. 134). The official data significantly underestimates the decline in employment in the primary sector and thus in agriculture. But accepting the official data for the moment, approximately 35 per cent of the employment in rural areas was outside of the primary sector in 1998. If employment in agriculture (farming plus animal husbandry) is the same proportion as it is of value added in farming, forestry, animal husbandry and fisheries, then employment in agriculture as officially estimated in 1998 was 283 million or 61 per cent of total employment in the rural sector or 40.5 per cent of total national employment (SSB, 1999, pp. 377 and 380). But this estimate of agricultural employment is certainly an overestimate. The State Statistical Bureau still counts the millions of temporary migrants to the cities as employed in rural areas and probably in the primary sector.² It is now clear that agriculture no longer provides employment for the majority of the workers of China. Roughly speaking, it is highly probable that in 1952 agricultural employment was about 75 per cent of the total; today it is almost certainly less than 40 per cent.

Labor Adjustment Yet to Occur

In spite of the enormous adjustment in the distribution of labor that has already occurred, much remains to be accomplished if rural people are to share in China’s economic growth in the future. Until quite recently, rural people have so far shared relatively equally in the benefits of economic growth during the reform period. Real per capita consumption has more than trebled (SSB, 1999, p. 72). While the increase in per capita income and consumption that occurred between 1978 and 1985 was due primarily to the improved productivity of agriculture and increases in real output prices, since 1985 a significant part of the improvement has been due to the increased importance of income from nonfarm employment and activities. In 1978 only 4 per cent of the income of farm households was attributed to nonfarm activities; in 1985 the nonfarm percentage had increased to 31 per cent and in 1998 the percentage had increased to 43 per cent. Transfer and property income accounted for approximately 6 per cent of total income in 1985 and 1998. Ignoring transfer and property income, it can be said that more than half of the increase in the income of rural people – perhaps as much as 55 per cent – came from nonfarm sources for the full 20 year period. Without the large increase in nonfarm sources of income for rural people, the improvement in farm productivity would have contributed little to their incomes.

The negative side of this positive story is that with nonfarm sources of income contributing more than half the increase in real income for rural people, the per capita consumption of urban households in 1998 was 3.3 times that of rural residents compared to 2.9 times in 1978 (SSB, 1999, p. 72); the ratio in 1952 has been estimated as 2.4 times. Thus the recent disparities in urban and rural consumption are probably greater than in 1978 and significantly greater than in 1952. These are comparisons in current prices. Thus the large adjustment in the sources of income and employment by rural people has approximately stabilized their position relative to the urban population. But was that a significant achievement? The really quite enormous changes in rural China – an increase of nearly 100 million jobs in the TVEs and more than 40 million jobs in private enterprises or self employment – was just sufficient to maintain approximately the same level of relative consumption or income. It is absolutely clear that the future prosperity of rural people does not rest primarily with agriculture but with finding more nonfarm jobs for workers now engaged in farming as well as for the new entrants to the rural labor force. ...

Table of contents

• Cover Page
• Title Page
• Copyright Page
• Table of Contents
• List of Figures
• List of Tables
• Preface, D. Gale Johnson
• INTRODUCTION
• PART I: CHARACTERISTICS OF CHINA’S URBANIZATION
• PART II: CHANGING URBAN POPULATION
• PART III: URBAN SPATIAL STRUCTURES
• 10 SPATIAL DISTRIBUTION OF INDUSTRIES AND CITIES: COORDINATION BETWEEN INDUSTRIAL AND URBAN DEVELOPMENT
• 11 HOW DO INDUSTRIALIZATION AND URBANIZATION AFFECT LAND USE?
• PART IV: URBAN GROWTH AND PRODUCTIVITY
• Index