Xiagang and re‐employment policies in Shanghai

Purpose – The purpose of this paper is to provide an overview of the job creation policies being used to address the high unemployment rate and number of xiagang in Shanghai.Design/methodology/approach – Using primarily Chinese language sources, the context of employment issues are discussed. This is followed by a brief analysis of each issue.Findings – Among the numerous setbacks caused by the ongoing reforms, xiagang and urban unemployment have become one of the most serious problems for the Chinese leadership. There are no panaceas on offer and just which combination of measures should be chosen is a matter for debate. Some combination of a less restrictive labour market, expansion of infrastructure investment and stimulation of re‐employment involving public and private partnership in areas where the market is unlikely to generate spontaneously appears as a suitable way forward. Recruitment subsidies are not favoured as a solution while a focus retraining on smaller, well‐targeted schemes for recogniz...