New urbanization and informal employment: Scale, pattern, and social integration

Abstract

With the development of urbanization, promoting the citizenization of migrant workers and improving the quality of employment has become an important goal of China's urbanization strategy in the new era. Affected by the COVID-19 pandemic, the problem of informal employment stands out even further. Starting with an examination of the relationship between new urbanization and informal employment, this study draws on the data from population census and the China Labor-force Dynamic Survey (CLDS) to estimate the scale of urban informal employment in China and analyze its spatial and sectoral characteristics. It then identifies the main social integration problems faced by informal workers and discusses some policy options. It is found that urbanization and informal employment are interrelated. Informal employment provides job opportunities for rural migrants with the inability to find formal jobs in cities and urban workers who are unemployed, playing a role in alleviating employment and poverty problems. It is argued that the new urbanization with the principle of putting people first should be concerned with the social integration of informal workers with the aim to promote their citizenization. According to the estimation based on multi-source data, the number of informal workers is 138 million-155 million, accounting for 33.2%-44.7% of urban employment in China. The unobserved/ unregistered informal workers are the majority. The distribution of informal employment is characterized by the spatial pattern that the scale of informal employment decreases from the eastern to the central and the western parts of China. In terms of employment types, most informal workers are employed in enterprises. Informal employment in China is mainly concentrated in the sector of wholesale, retail trade, and catering, followed by the sectors of residential service, repair, and other services and manufacturing industry. Informal workers are faced with difficulties in social integration, including job precarity, income instability, social marginalization due to population registration restriction, limited access to public services, and vulnerability to crises. It is recommended that policy intervention should pay attention to improving the quality of informal employment and promoting social integration of informal workers in the future.