<p>Urban–rural integration constitutes a fundamental pillar of structural transformation in transitional economies, yet prevailing macro-urban bias has systematically undermined the accuracy, inclusiveness, and effectiveness of integration policy. Moving beyond the infrastructure-led paradigm, this study develops a human-centered social integration framework that reconceptualizes labor migration as the spatial reallocation of human capital. Exploiting the rich micro-level information on migrants’ socioeconomic circumstances, institutional positioning, and socio-psychological perceptions contained in the 2016 wave of the China Labor-force Dynamic Survey (CLDS), we employ logistic regression models to examine how this reallocation can achieve spatial optimization at lower political cost. Three findings emerge. First, rural–urban migrants have largely achieved spontaneous integration at the micro-level, with evolving neighborhood networks functioning as a catalyst for gradual social integration. Second, institutional dualism operates as a structural constraint that paradoxically reshapes integration trajectories: while the <i>hukou</i> system erects formal barriers to urban membership, it simultaneously fosters localized compensatory networks that facilitate integration along specific dimensions. Third, socio-psychological factors—including subjective socioeconomic status, perceived injustice, and sense of community belonging—exert heterogeneous effects across proactive, progressive, and multidimensional integration outcomes. Collectively, these findings underscore the imperative of transitioning from survival-oriented unilateral migration toward quality-driven integrative migration, offering theoretical and policy insights for advancing people-centered urbanization across the Global South.</p>