The Effects Of Offshoring In China On Structure Of Heterogeneous Labor Employment

In recent years, offshoring has become an engine of the rapid development of international trade. Objective evaluation of the offshoring’s impact on the employment structure of heterogeneous labor forces has a great significance for the economic restructuring and social stability in China. This paper defines offshoring from the perspective of intra-product and emphasizes both advantages and disadvantages from participating international division when China acts as contractor in offshoring.The procedure of the study includes:Firstly, by using the input-output analysis method, the regional input-output table of world input-output database, the paper decomposes China’s total exports through the International Input-Output Model; by using the proportion of the foreign added value in China’s exports as the index of offshore level, it also estimates the offshoring indexes of the manufacturing industry to developed economies and other segments. Then, by adopting the related data, this paper has a descriptive analysis of the employment situation and employment structure of the heterogeneous labor forces in China. Finally, considering industry classification and different trade partners, this paper analyzes the effects of China’s offshoring on the employment structure of heterogeneous labor forces by using dynamic panel data model.The paper has the following main conclusions:1. the domestic portion of China’s exports decreases; export goods transfer to intermediate products; offshoring has an increasing trend; the offshoring indexes of manufacturing industry to developed economies and high technology industries are high, which shows China is deeply involved in the international division of production system.2. The employment structure of heterogeneous labor forces is significantly improved; employment growth shows a V shape in high, medium and low skilled labors; at the same time, employment polarization phenomenon is significant in high technology industries.3. China’s offshoring optimizes the employment structure of heterogeneous labor forces and high technology industries have more effects; the offshoring of manufacturing industries exacerbates the phenomenon of employment polarization, but upgrades the employment structure in the high-tech industries; at the same time, offshoring increases wage elasticity, restrains the improvement of employment structure caused by R&D and capital, and brings a certain degree risk of employment.