Monday, November 26, 2012

Urban Job Growth in China

After I wrote last week's big post on the size of the construction industry in China, it occurred to me that one constraint that China might face on its urbanization process could be somewhat novel.  This is that the sheer speed of China's urbanization is unprecedented and risks running out of people young enough to be willing to migrate at a significantly earlier stage than other countries that have engaged in this kind of catch-up growth (which spread their growth out over more generations of humans).

Thus, it's desirable to have more granular data on the urbanization process than the decadal census data I showed last time.  Poking about the national statistics site, I found annual data on the number of jobs that are urban vs rural which seems a somewhat helpful proxy.  The data only go through 2010; that isn't ideal but it's what we have.

The plot above shows the fraction of all jobs that are urban (red, left scale), and the absolute increase in the number of urban jobs (green, right scale).  You can see that the rate of growth is slowing down somewhat, but no decline in the urbanization had set in as of 2010.  You can also see that the financial crisis of 2008 did cause a modest slowing in the urbanization process.  It may be that the seeming slowdown in the Chinese economy has had a similar effect in 2011/2012, but we won't know for a while.

1 comment:

Don Johnson said...

This is a very interesting question, which prodded me to do a little inconclusive googling. Is there in fact a natural limit to the speed of urbanization - that is, if you run out of, say, 16-30 year-olds, does urbanization slow dramatically or stop? I didn't find an answer to this, but I found one source (The World Bank's "World Development Report 2009", in Google Books) that claimed that in percentage terms recent urbanization rates in the developing world are similar to rates in Great Britain and the US when they were urbanizing, and that China's urbanization rate is not outstanding among developing countries. (Absolute size is another matter.) Also, I would guess that if the push and pull factors got strong enough you would also see urbanization among younger and older groups. So my initial feeling is that demographics probably won't be a brake on China's urbanization.