Chinese Job Growth and Workers’ Injury Compensation in China

Over the past decade, the PRC has made dramatic changes to its labor contract laws, corporate laws, and social welfare system in an effort to improve workers\u27 wellbeing and decrease the impact of rights violations on the public healthcare system and national budget. This paper seeks to determine the effect of changes in social welfare policy made in 2003 on workplace injuries and illness in light of the domestic job growth that took place at that time. In 2003, changes in marketplace behavior, corporate law, and enterprise management policy led to a trend break in employment, wages, and insurance coverage (Kato). The econometric model described in this paper measures whether workers’ compensation for injuries and diseases incurred at work increased overall due to this policy change. To accomplish this, I first determined how each industry is experiencing changes in employment and wages. Second, I used province level data to determine which industries have experienced changes in work-related injury and disease insurance coverage since the policy changes. Using this information, I found evidence that suggests that the workers’ insurance coverage improved overall, and that a greater number of workers are being compensated for injuries and illnesses incurred at work. Though a smaller proportion of workers are insured, more workers are receiving compensation. The study also analyzes changes in wages by industry with respect to injury and disease rates, showing that workers in the mining industry are paid disproportionately considering their risk of disease. The results also show that government workers received a significant pay raise due to the policy changes