Scott Rozelle (Stanford University)

China’s growth has relied heavily on unskilled labor. Most of China’s workers (~70%) come from rural villages and have never been to high school. While this national growth strategy has been effective for three decades, the unskilled wage rate that has been rising for more than a decade, inducing companies inside China to automate and triggering an exodus of companies seeking cheaper labor in other countries. Drawing on extensive surveys in China, my work will show that while China may be the second-largest economy in the world, its labor force has one of the lowest levels of education of any comparable country. The low levels of basic education of such a large share of workers may leave many unable to find work in the formal workplace as China’s economy changes and manufacturing jobs move elsewhere and the implications of this both inside and outside of China could be serious.