Research On The Effect Of Social Security Contribution Rate On The Employment

Employment is the foundation of people's livelihood and the source of wealth.The Chinese government has always given priority to the policy of raising employment level.Premier Li Keqiang emphasized that employment priority policy must be fully exerted strength at the Second Session of 13 th NPC in 2019.Although the overall level of employment in China is still rising,the growth rate continues to decline and employment pressure remains unchanged.One of the key issues affecting employment levels is the high rate of social insurance contribution.The high rate of social insurance contribution in China has attracted wide attention in recent years.Since 2015,the government has introduced a series of measures to reduce the social insurance contribution rate to help enterprises and individuals reduce their burdens.In order to assess the impact of employer's social insurance contribution rate on employment systematically,this paper will analyze from the following aspects: Firstly,summarizing the literature about the employment effect of social insurance contribution rate.Secondly,collecting and collating the development of social insurance system from establishment to reform,the social insurance contribution rate from setting to reducing,and the actual situation of employer's social insurance contribution rate.Thirdly,summarizing the employment situation of China.Finally using the data of CCER database,RESSET database and China statistical yearbook from 2010 to 2017 to establish a model for data analysis,and draw the following conclusions.According to the analysis of GMM regression from the demand side of labor,it is found that the employer's social insurance contribution rate has a significant negative impact on the labor demand,as the employer's social insurance contribution rate increase 1%,the employment level will decrease 5.3%.According to the simultaneous equation model from both demand and supply side of labor,it is found that the employer's social insurance contribution is negative to labor demand but positive to labor supply.And the negative impact on labor demand is greater than the positive impact on labor supply.Therefore the high social insurance contribution rate is still negative to the employment level.