The Influence Of The Quality Of Labor Force To Chinese Economic Growth

More than thirty years of reform and opening up, China’seconomy has made a long-term high growth and created the "Chinamiracle" around the world. People’s living standards has improved verymuch and the industrial structure of China’s economy is also becomingmore and more optimized, but the traditional extensive mode ofeconomic growth hard to keep blossoming, we must change the mode ofeconomic development. Traditional large-scale investment forstimulating economic growth is facing with different problems such asthe industrial transfer, resources waste and environmental pollution. It isalso difficult to support by increasing the investment of the statefinancial. The tradition of economic growth relying on the quantity oflabor forces no longer is able to continue to drive either. China is alreadyfacing a turning point in the population bonus, while accompanied bythe improvement of the living standards; the price advantage of the laborforce has been replaced by some developing countries in Asia.Investment in physical capital, as well as the amount of labor force hasnot exited anymore. The only way for the economic continuing growth isimproving the quality of the labor force, as well as the technicalprogress, the rational allocation of resources and the improvement of theproduction efficiency for the substitution effect.This article will base on the analysis of the fact that economicgrowth as well as the quality of the current labor force by using thedata information from the previous census and the World EducationDatabase, analyze how the quality of China’s labor forces contribute tothe economic growth. And analyze the status of the quality of the laborforce in China compared with the developed countries around the worldby the economic growth model. On this basis, the paper will show a fewcreative suggestions on the improvement of the quality of the Chinalabor force, as well as promoting the rational allocation of labor for China.Firstly, it describes the great achievements of the country’s economicgrowth from the time series of the total economic growth, grossdomestic product (GDP) per capita, and the changes in industrialstructure. Then, on the basis of the sixth census data, it analyzes thestatus of the quality of the China labor forces, the internal quality of thelabor force of the three industries and the different quality of labor in thethree industries, and it shows that the distribution of different quality oflabor in the three industries is not reasonable enough, the overall level isstill at a low level. As China is facing a turning point of populationbonus currently, and actually the extensive mode of the traditional highinvestment promoting the economic growth may not effective. In thefuture, the economic growth will depend more on the improvement ofthe quality of the labor force and total factor productivity improvements.In order to illustrate the role of the quality of the labor force working oneconomic growth better, we created the model for the fact of China’seconomic growth since the reform and opening by the effective labormodel. Then it decomposes the contribution of the various elements forthe economic growth by the Solow residual method, in which humancapital broken down into two aspects that is labor quantity and quality oflabor. By explaining the change for the history of the quality of the laborforce contribution to economic growth, it will show what role of thequality of the labor force as production factors played in the economicgrowth in the past. At the same time, based on the international researchexperience, the quality of the labor force for economic growth is notonly reflected in the factors of production, but reflected in theproductivity improvements much more. We can build the functionrelationship by taking advantage of the whole level for the quality of thelabor force, the quality of the labor force structure and total factorproductivity, Then we found total factor productivity need to beimproved by the improvement of the overall quality of the labor force, and also thanks to the proportion of highly educated labor force to thequality of the labor force structure changed. After make sure the futureeconomic growth rely on the improvement of the quality of the laborforce and total factor productivity improvement, at present, our countryis living in international competition. So, clearly understanding the levelof gaps in the quality of labor between China and developed countries inthe world, then making sure the key point of investment, will make ourcountry more favorable competitive on the world economic stage. It canbe found that the quality of the China labor force is far lower than thedeveloped countries, the United States, ROK through compared by theestablishment of a production function model of the United States andSouth Korea’s economic growth function. Why the gap is so large? Withthe Barro and Lee database, the comparative study of the quality of thelabor in China found that the gap for the quality of the labor forcebetween China and South Korea is30years. The quality of the Chinalabor force in2010is just at the level of the United States in1950.Aiming at the China current situation for the quality of the labor force,this paper focus on the increasing national financial educationinvestment, widening the sources of funding for education, improvingvocational education and training tools,improving labor vocationaltechnical level, upgrading the industrial structure to promote optimalallocation of labor, using the financial and tax to promote high-qualitylabor force, promoting the rational flow of labor, and several otheraspects, to improve the contribution for the quality of labor force toeconomic growth.