8.2C Movement of Labour

• • In may nation states, the movement of labour is unrestricted and is based on the notion that humans are an economic resource for businesses to exploit
  • It is considered an efficient way of allocating resources e.g. regional movements in the UK
• Free movement of labour = allows workers to seek work in another country, without requiring any visa

  -> e.g. the Shanghan Agreement
• Advantages of free movement of labour:

  • Business profits increase due to a fall in wages - businesses have a choice of who to employ
  • Highly skilled workers are in demand and command higher wages
  • Trickle down wealth from core regions to the peripheries - branch offices and factories
  • People have a choice of where to work and live
• Disadvantages of free movement of labour:

  • Increased competition for jobs and many people have multiple jobs in order to survive
  • Businesses lose profits when having to pay higher wages to skilled employees
  • Changing economic activity and loss of income or unemployment
  • Loss of talent - 'brain drain'
• China's hukou records

  • As of 2020, 60.6% of the total Chinese population lived in urban areas, a dramatic increase from 17.92% in 1978
  • Chinas Hukou system acts as a barrier to free movement of labour
• Chinas Hukou system (P3):

  • The Hukou System effectively limits the amount of rural-urban migration. People from rural China would be far less likely to move to urban areas if it means giving up their healthcare, education and social security
  • People from urban areas were given preferential treatment
  • They got better social benefits; since their local governments had more resources
• Impact on rural regions (Hukou system):

  • Whilst urban citizens enjoy a supply of labour opportunities and comfortable benefits for their families
  • Rural people struggle as farming in rural China is very difficult
  • The terrain is mountainous and the land lacks sufficient nutrients for farming
  • Access to clean water is scarce and there is often extreme draught
  • There is little economic infrastructure and a lack of access to modern farming equipment
• Floating population – 240 million people as of 2020:

  • Non-hukou migrant without local residency rights are also called the 'floating population'
  • Often it is the parents moving to the cities, leaving their young children to be raised by grandparents
  • These children are the forgotten casualties of China’s economic boom
  • These migrants have no access to healthcare, workers' rights etc. in urban areas
• Reform:

  • All Chinese people will now simply be called residents, but, all social benefits are still tied to a resident’s hometown
  • There is a process to transfer residency, but it is extremely limited in the major cities 
  • However, it will be easier for people from rural areas to move to other rural towns and smaller cities
• Impacts of Chinas Reform (P1):

  • This is an acceptable condition for China, as they have successfully avoided squatter settlements and public protests around their major cities 
  • Today, there are still over 250 million people in rural areas living on less than $2/day