Toward an inclusive system for informal workers? Diverging impacts of labor informality on Chinese workers’ pension enrollment

Abstract

The Chinese pension reform of 2011 allowed informal workers to enroll either in the employment‐based pension program or in the residency‐based pension program. Despite this historic pension reform, the question of how labor informality influences one's pension participation under the reformed pension regime has been insufficiently discussed. This article fills this gap by analyzing two waves of a national‐level survey—the China Labor Dynamic Survey of 2012 and 2014. This article makes the following two points. First, the impact of labor informality differs across the two pension programs. Second, local citizenship filters the negative impact of labor informality, but only for the residency‐based pension program. Having “local” citizenship does not offset the negative impact of labor informality on workers’ enrollment in the employment‐based pension program. These findings show how the recent reform is ironically reinforcing the existing social cleavages between different types of Chinese workers.

Welfare developmentalism with interactive central–local relations: Understanding the recent expansion in pension coverage in China

“…Source: Based on data from the China Statistical Yearbook (2007)(2008)(2009)(2010)(2011)(2012)(2013)(2014)(2015)(2016)(2017)(2018)(2019)(2020). (Yang, 2021). However, for a country of multi-level governance, we should incorporate both the forces of top-down pressure from the central government and bottom-up motivations derived from the local conditions into the analytical framework of welfare developmentalism to investigate policy implementation in detail.…”

“…formal, informal, or self‐employed) and local citizenship status (i.e. local or non‐local) (Yang, 2021). Fourth, to promote urban–rural integration, the URP and NRP were merged into a uniform residency‐based pension scheme in 2014.…”

“…Under its recentralisation process, the Chinese central government has transformed its welfare system from an employment‐based scheme (i.e., a system in which formal employment is the most important criterion for welfare entitlement) to a state society‐based scheme (i.e. a system in which welfare is distributed based on social citizenship) (Yang, 2021). However, for a country of multi‐level governance, we should incorporate both the forces of top‐down pressure from the central government and bottom‐up motivations derived from the local conditions into the analytical framework of welfare developmentalism to investigate policy implementation in detail.…”