This chapter first provides a brief review of Chinese labour policy prior to the economic reforms. This is followed by an overview of labour policy changes in the reform era. The chapter then describes unemployment problems in the context of market transition and the Chinese government's policy responses. Moreover, the chapter explores the influence of the labour policy reforms, in particular the government's unemployment measures, from a well-being perspective. Changes in Chinese labour policies took place in the economic reform era. Unemployment rose to becoming a nightmare facing many Chinese workers, especially state workers. It is noted that the active employment policy mainly targeted laid-off and unemployed state-owned enterprise (SOE) workers. The labour market developed, and a more flexible employment system was established. While labour mobility increased, job security was reduced.
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