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Description
Most of the low-skilled workers who for three decades have powered China’s economy are people who were born in the countryside and moved to urban areas. They are often called mingong, or peasant workers, even though they have little if any experience of farming; or else, less disparagingly but just as misleadingly, “migrant” workers, though older ones like Mr Zhang may have moved to the cities many years ago and younger ones may have been city-born, to migrant parents. Under China’s household-registration system, known as hukou, rural connections, even if inherited, determine the kind of welfare benefits individuals may receive. Some of the first generation of migrant workers, who arrived in urban areas in the late 1980s, have reached retirement age. Most people can qualify for a state-supported or employer-backed pension scheme at 60; some women can do so at 55 or even 50. For city-born workers, that means nearly 2,070 yuan a month. But workers of rural origin receive far less—not nearly enough, in most cases, to sustain them in the cities in which they have been working. Many have little choice but to carry on with their jobs or, in some cases, to return to the countryside to live on their farms, if they have them. Chinese officials talk of reforming the hukou system. But changes have been painfully slow. The need for reform will become more pressing as the elderly proportion of those classified as migrant workers bulges. From 2008 to 2013 the number of such people over the age of 50 jumped from 26m to 41m, or from 11% to 15% of the migrant workforce. The ageing of China’s population will accentuate the problem. In 2014 there were 212m Chinese over 60, or 16% of the population. By 2025 there will be 316m people over 60, or nearly one in four. At the same time the supply of younger workers is shrinking, along with their enthusiasm for grunt work. Many factories once spurned workers much older than 25. Now a shortage of younger workers is forcing them to take on older people. Urban Chongqing has long been known for its so-called bangbang men and women who carry heavy burdens on long bamboo poles (or bang, pictured above) up and down the sweltering city’s steep hills. The average age of these country-born labourers is conspicuously higher than it was a few years ago. Some are so elderly that it seems shocking to see a younger person making use of their services. Many people will keep on toiling until their ageing bodies fail them. The notion of pensions for such workers is still new. The hukou system is widely resented, but at least it allows people of rural origin, or their offspring, to retain a small plot in the countryside and to use a piece of land nearby for housing. The government had long viewed these entitlements as a form of pension for migrants. That began to change in 2009 when it introduced a pension scheme for rural hukou holders, supported by state funding and contributions by workers themselves. It allowed participants to draw a pension at 60 from their hometown, usually by bank transfer, so long as they had made contributions for 15 years. Those who turned 60 in 2012 or earlier were usually eligible without contributing. By the end of 2013 nearly 475m were enrolled in the scheme. The benefits are minuscule. The minimum basic pension is 55 yuan (about $8.85) a month, far below the poverty line. The government says it increased rural pension benefits in 2014 by an average of 15 yuan per month. But increasing benefits substantially will be difficult as the ratio of pensioners to working-age migrants increases. The government has discussed raising retirement ages, perhaps by 2020. The country is gradually relaxing its one-child-per-couple policy, but too late for many older migrant workers who may often have only one child to look after them. Employer contributions will boost the pension accounts of some migrants. But many work without contracts, which means they cannot enjoy employer-funded benefits. In the long run a radical makeover of the hukou system will be needed, to allow migrants to enjoy the same welfare benefits as anyone else. Reforms are happening in some small cities, where migrants stay close to home. But the government worries that big cities would be deluged by welfare-seekers if they carry out the same reforms.
Keywords
Hukuo, China, rural, urban migration, registration, migrant labour, pension, retirement
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