Shanghai takes action to bolster employment

Twenty-six measures have been introduced by Shanghai to stabilize employment in the city after the COVID-19 pandemic put the brakes on economic growth.

According to Zhang Lan, deputy director of the Shanghai Human Resources and Social Security Bureau, the local employment situation is relatively stable. By the end of May, there were more than 10 million employees in the city, slightly up from the same period last year.

 “There are no large-scale redundancies in Shanghai and the number of employed people is climbing step by step, with stable unemployment rates,” he said. “But as adverse factors will remain for a long time, we need more policies and measures to reduce burdens on enterprises, inject vigor into the market and boost confidence for laborers.”

To ease burdens on enterprises, the city will extend its currently reduced premiums for unemployment and work-related injury insurances against employees’ salaries till the end of April, 2021.

According to Zhang, Shanghai decided to waive or reduce premiums paid by some employers for pension funds, unemployment insurance and work-related injury insurance between February and June to reduce the burden on businesses during the coronavirus epidemic. The policy is expected to reduce the social security fees paid by enterprises by 53 billion yuan (US$7.6 billion). It has also refunded more than 2.5 billion yuan of unemployment insurance premiums to about 126,900 employers that did not lay off employees by the end of May.

It will continue to provide subsidies to enterprises that have supported the fight against COVID-19, as well as those seriously affected by the pandemic. By the end of May, it received applications from 625 enterprises that contributed to anti-virus efforts and 3,793 seriously affected, involving 53 million yuan and 240 million yuan respectively.

Meanwhile, the city has also planned to increase financial support for local enterprises, such as increasing loans for micro, small and medium-sized enterprises, and building up platforms to help enterprises further develop domestic markets.

It will continue to support development of new industrial and service models, including online shopping, online education, online work and intelligent distribution.

Redundancies will be regulated. The city government encourages enterprises to negotiate with employees to adjust salaries, working hours and training to retain staff. Authorities are asked to guide enterprises that plan to lay off employees to work out appropriate schemes for employee placement. Employers are required not to fire employees who cannot resume work due to the pandemic.

More support will be provided for private businesses, such as reducing their VAT rate from 3 percent to 1 percent. Financial organizations are encouraged to provide loans with preferential interest rates for such businesses.

To create jobs, the city will promote the development of industries like housekeeping, cultural creativity, tourism and senior care.

The city will continue to provide subsidies for enterprises that hire residents who have been unemployed for more than half a year and fresh college graduates till the end of year.

Startups are also encouraged for their important role in creating jobs. Incubators are asked to lower thresholds for business starters and reduce management and service fees for them. Guaranteed loans and interest deductions will also be offered.

The city will promote online vocational training, provide subsidies for trainees and build up more training centers.