The Impact Of Changes In The RMB Exchange Rate On Manufacturing Employment

The exchange rate is at the heart of the various variables in the open economy.Changes in the real exchange rate from the outside to the inside,from macro to micro aspects,all aspects of the open economy has a profound impact on the operation.The impact of RMB exchange rate changes on China's various aspects of the economy has become the focus of the domestic and foreign scholars.Many studies began to focus on the RMB exchange rate changes on the real economy impact.The realization of a domestic and external balance,not only to consider the balance of payments,but also consider economic growth,price stability and full employment.The role of employment which can not be ignored,it is to promote a country's economic development and social progress,an important driving force.For any country,employment is not only a social problem,but also an important economic issue.How to create employment and resolve unemployment,is the biggest problem faced by contemporary governments.The manufacturing industry is an important industrial sector to absorb employment.The output and employment decisions are not only highly dependent on international trade,but also the main industrial sectors that attract unskilled labor force.They are more vulnerable to the direct impact of exchange rate changes.In particular,the Yangtze River Delta region,economically developed,opening up to a high degree of processing trade in the Yangtze River Delta coastal areas of SMEs are faced with rising production costs,manufacturing workers,the threat of unemployment,employment problems prominent.In the existing researches on exchange rate fluctuation and employment relationship,there are more researches on developed countries and regions,less on developing countries.This paper mainly chooses the manufacturing employment in Yangtze River Delta as the object of study,and analyzes the effect of RMB real effective exchange rate on employment of manufacturing industry and the impact on the industries with different characteristics.In this paper,the research on the relationship between exchange rate and employment is systematically reviewed,so as to lay the foundation for the relevant theoretical analysis.In theoretical analysis part,the paper elaborates on the RMB exchange rate affect the manufacturing industry in China's transmission mechanism.At the theoretical level,the exchange rate changes mainly through the external trade channel,foreign direct investment channels and resource allocation channel to analyze the exchange rate changes on the impact of employment.In the empirical test,the co-integration test is used to analyze whether there is a long-term cointegration relationship between RMB real effective exchange rate and manufacturing employment in Yangtze River Delta.Through the empirical results,it is found that the impact of the exchange rate on the employment of the manufacturing industry in the Yangtze River Delta is negative both in the long run and in the short run.But also finds that the effect of exchange rate change on the employment of manufacturing industry in Shanghai is the least,which has the greatest influence on the whole employment of manufacturing industry in Jiangsu Province.Then,through the characteristics of factors,the manufacturing industry is divided into labor-intensive,capital-intensive and technology-intensive industries.Through the establishment of the panel data model to analyze the effects of changes in exchange rate of the manufacturing industry in different types of employment.It is found that the exchange rate appreciation is not conducive to the employment of labor-intensive manufacturing industry,but the impact on capital-intensive and technology-intensive manufacturing industry is not statistically significant.At the end of the paper,the conclusions and policy recommendations are summarized.This part sums up the mechanism and effect of exchange rate on manufacturing employment in the Yangtze River Delta region.The RMB real effective exchange rate depreciation will promote the Yangtze River Delta manufacturing employment growth.The impact of different provinces and cities of different degrees,which with the local economic development,industrial structure and industrial policy are related.Combined with the empirical analysis and the Yangtze River Delta economic situation,puting forward policy recommendations.The further research on the shortcomings is put forward and the direction of future research is proposed.