The Evolution of China’s Labor Market from Segmentation to Integration: An Outline and the Reality

This chapter, based on an analysis of historical data, explains how market and institutional factors have worked on market integration (segmentation) in the evolution process of China’s labor market. Such an evolution occurred in response to a change in China’s population structure, and is mainly attributed to the household registration and ownership systems which caused the dichotomy and difference inside and outside tizhi. Due to the impact of the marketization process and a host of other factors, the almost completely segmented labor market has been replaced by one that exhibits the features of “multi-tiered segmentation” based on the household registration and ownership systems. It is also proposed that the double duality of China’s labor market is expected to be reduced in the future and greater labor market integration will occur due to the market-driven allocation of labor resources.