The Relationship Of RMB Exchange Rate And Employment In China

Since entering in 2015, the RMB exchange rate fluctuations, the RMB against the US dollar devaluation state showed. China’s economy has downward pressure, the economic growth rate showed a downward trend, and our population of employment is increasing, which gives China’s already grim employment situation a greater challeng. While the exchange rate as an important means of macroeconomic regulation and control, have a significant impact on a country’s economy.In this case, the study of influence of RMB exchange rate on China’s employment has important practical significance.On the basis of previous academic,studies on the relationship between RMB exchange rate and employment in China were studied. First, using the error correction model (VECM) Granger causality test analysis on the exchange rate for the dynamic effects of short-term employment mechanism of inquiry, empirical results show that:in the long run, employment, exchange rates, exports, foreign direct investment in China four the presence of long-term equilibrium relationship between variables; in the short term, the RMB real effective exchange rate will have a negative impact on employment, and the role of impact along with exports and foreign direct investment on employment. Then after cointegration analysis, we found the RMB exchange rate appreciation on employment robust inhibition.. Then, taking into account China’s regional economic development and trade of non-equilibrium diversity, exchange rate on regiongal differences and trade differences in employment impact areas were studied by using panel data model, the results showed that:on the regional differences, the impact of renminbi exchange rate movements on the western regional employment is not significant, while the central and eastern regions will have a significant negative impact; on industry, there is a big difference between RMB exchange rate effects on different industries, high degree of openness and labor intensive industries particularly significant.Finally, taking into account previous studies on the exchange rate and the employment relationship is mainly concentrated in developed countries, few studies for developing countries. Thus the use of panel data,the relationship between exchange rate changes and employment of the whole woeld were explored, empirical results show that the impact of exchange rate changes on employment in developing and developed countries are significant, but it will have a negative impact on developing countries, and developed countries will have a positive impact.