Employment, Emerging Labor Markets, and the Role of Education in Rural China

The overall goal of this paper is to contribute to the ongoing assessment of\r\nChina’s rural labor markets. To meet this goal, we have three specific objectives. First,\r\nwe will provide an update of the trends in off-farm labor participation and wages of the\r\nsample households and examine how labor market outcomes have changed for those with\r\ndifferent levels of education. Second, we will then seek to examine if education in\r\ndifferent time periods – the late 1980s, the early 1990s and the mid 1990s -- can be\r\nassociated with increasing access to off-farm jobs. Finally, we will examine how returns\r\nto education have changed during the course of the reform era. In short, our hypotheses\r\nare that if labor markets are increasingly rewarding those with a.) better education job\r\naccess; b.) easier entry; and c.) higher wages, such outcomes will count as evidence that\r\nlabor markets are improving. Both the descriptive data and the multivariate analysis\r\nrobustly support the findings that between the late 1980s and the mid-1990s, labor\r\nmarkets have improved in the sense that rural workers have been increasingly rewarded\r\nfor their education.