The Analysis On Relations Between China's Economic Growth And Employment

According to the Okun's Law, when the economic growth is high, the unemployment will be relieved. But China has maintained a high economic growth rate since it was established, meanwhile, the unemployment in China has become increasingly serious in recent years. This situation runs counter to the Okun's Law on the surface.However,the use of the Okun's Law is restricted to the economic conditions of a country. China has its speciality of binary economy system and transition, it must be very cautious when we apply the Okun's Law to our country.In our country the labor is unlimited.This paper examines the characteristics of China's actual economic operation at the beginning. On the basis of capital-driving economy,we modifies the Okun's Law.Considering the accounting of employment target, it puts forward the concept of the natural rate of employment corresponding to the concept of the natural rate of unemployment in Okun's Law . Finally, based on a new understanding of Okun's Law, it suggests a new test model According to the data available, the paper tests the model later,and gets a conclusion which means when the actual economy growth rate is 1% more than the potential growth rate, the actual employment rate will increase 1.46 percent.Therefore, the economic growth and employment in China does not contravene the Okun's Law. In recent years, the unemployment is increasing serious. It is because the efficiency of capital is decreasing. The economic growth does not up to the supposed number, and the actual growth is lower than potential growth rate, resulting in the decline in employment absorption .However,the gross of the investment is continually increasing. The paper thinks that the contradiction is the production is also subject to land, mineral resources and productivity at present. The result also gives us a warning.Our country can no longer rely on the input of productive elements,and we should transfer our economic motivity to technology.