Implications of the Unemployment on Business in China - Literature review Example

Portfolio Industrialization in China Industrialization has for many years been the leading economic activity in China. Industrialization contributes above 70% of the total gross domestic product (GDP) of China. For instance, industrial production in the country increased to 7.2 percent in 2014 (Frank, 2011). The main sub-sectors that have contributed to this increase include; manufacturing, mining, electricity, water production, gas, heat, and supply. In China, the production of industrialization measures a large percentage of business output integrated in the above mentioned industrial sectors. China has become one of the industrialized countries to some extent (Lin, 2013). The pillar Chinese industries like housing and auto industry are developing in leaps and bounds. Steel and iron are also major manufacturing industries in the country. The main exported products in China are electric and machinery equipment and the most imported products are the raw materials used in industries. Because of economic extro-version, the industry of China has internationally competed in the recent years and as a result, the industrial development in the country is highly influenced by global economic environments (Sigurdson, 2007). Exportation in China is becoming more challenging and the prices of exports keep on declining. Foreign-invested enterprises and products’ market share, on the other hand, keep on increasing. These two factors increase the challenges that the domestic industry of China face based on production and selling (Fang, 2012).For instance, the domestic enterprises are affected particularly. In addition, industries such as light and textile have decreased their growth rate since the year 1985. Additionally, the production rate of products such as durable consumption goods has drastically decreased. The main dominant sector in the economic status of China remains its industries and manufacturing sectors. Despite decreasing the nation’s GDP by 3.3 percent, industrialization still remains the leading sector and has contributed to 45.3 percent of the country’s GDP in the year 2012 (Bramall, 2007). This cemented the position of China as the leading country in terms of industrial output. The industrialization sector in China has not only increased the economic growth of the country, but also increased the rate of employment opportunities. More factories are being opened day by day in China, thus creating both professional and non-professional employment opportunities. Industrial development have an important role in both economic growth and the creation of employment opportunity. Along with this accelerated growth, the rate of poverty in the country has dramatically declined (Kueh, 2008). China, due to industrialization has managed to achieve growth that has equity. Despite these positive impacts, industry is one of the economic activities that have serious negative effects. The growth of industrialization has higher contribution to the country’s environmental pollution. China is among the leading developed countries in terms of carbon emission. However, the government is implementing serious policies to handle pollution problems. For instance, in the year 2006, the country used 1.22 percent of its GDP on investments intended to control pollution (Dutta, 2006). The government has put into action reduction targets to reduce water pollution discharges such as sulfur dioxide and chemical oxygen demand (COD). Lastly, the Chinese government should implement policies to reduce the side effects brought by this economic activity since it is among the major leading economic activities in the country. Position paper Youth unemployment in China Due to the increased global economic crisis, the rate of youth unemployment has increased worldwide. In most of the developed countries, approximately 18% of the youths are jobless. There is no proposed factor that drives this unemployment trend. For example, in China, youth unemployment is centered in the manufacturing sector dominance, which offers more employment opportunities for secondary school graduates that college and university-graduate employees (Schucher, 2014). Youth unemployment in the country also stems from market mismatches. According to most studies, a large percent of the industrial employers claim that the graduates do not possess the need skills to work in industrial sectors (Yueh, 2013). However, whatever the key factor could be, financial inequality is undoubtedly the main factor that accelerates this problem. However, police makers in many countries have done comparatively little to find a solution to this problem. The government of China has implemented several programs inorder to increase employment opportunities for college and university graduates. These programs range from employing youths to work as village administrative officers and promotion of entrepreneurship among graduates to increasing graduates’ employment opportunities in civil service sectors. However, in retrospect, almost all these programs have not made significant improvements. Since the unemployed graduates are more than the available job opportunities, the police makers in Chinese government should deeply address this issue with a deeper strategic thinking (Xi, 2006). The technical and tertiary education in the country should undergo through substantial changes in order to rise the receptiveness of colleges, polytechnic, universities as well as other learning institutes to the needs of labor market. Summary of the NU MUN debate The countries that participated in the discussion were: China France Europe Japan Mexico Issues regarding unemployment There were a number of issues that were raised during the debate regarding youth unemployment. Some of the common issues included: (i) increased youth unemployment rate has negative effects on productivity and economic growth. In most countries, there is the loss of skills and talents because many university graduates do not have the opportunity to exercise the capabilities and knowledge. (ii) Increased rate of jobless youths increases poverty risk, social exclusion, de-skilling, and lack of motivation. (iii) Unemployment among youths leads to mental health problems and reduces the level of happiness (Liu, 2012). In some countries such as Europe and China, youth unemployment is viewed as both a security matter and human rights issue. In Japan, Mexico, and France youth unemployment is viewed as a drawback towards economic growth. Solutions to youth unemployment Youths should be integrated in labor markets in order to reduce the negative effects caused by their unemployment. Job creation and public and private partnership were also other mentioned solutions to youth unemployment (Ikels, 2006). Another suggested solution was that all organizations should show total commitment towards ending youth unemployment. Offering medium and small enterprise loans were also among the suggested solutions. This solution was voted as the main resolution that can fully help reduce youth unemployment (Dorfman, Holzmann, OKeefe & World Bank, 2012). This is because using the microfinance approach creates more jobs in a short duration compared to other approaches. Youths will only be given loans at a low interest rate to start their businesses (Narayanasamy, 2003). Global population change For the past 50 years, the world’s population has increased more rapidly increased more than it was projected to multiply in the future. In the year 1950, the globe had only 2.5 billion population, but this number increased to 6.5 by the end of 2005. It is projected that, by 2050, the world’s population could increase to more than nine billion. However, population in the most developed countries is already decreasing and there is expectation of such populations stabilizing. The world’s population increase is surrounded by a number of global issues. Three of these issues are; have impacts on economic development, cause environmental problems, and increase violence. High global population creates pressure on the little available natural resources, reduce both public and private capital formation, and reduces the capital stock per worker (Izazola& Marquette, 2005). However, population growth has positive effects on economic development, such as specialization and economies of scale. Many people have the feeling that future international wars will be based on natural resources. Political conflicts will mean that the globe will experience increased violation of human rights and deaths of thousands of innocent people. The past wars were influenced by resources and trade, but future wars will be fueled by lack of enough natural resources. Lastly, population increase causes a lot of harm to the environment. Population growth has caused many environmental problems starting from climate change to loss of species. Trends like loss of plant cover, forest, global warming, and depletion of major fisheries have all resulted from world’s population increase. The biggest issue worsening the earth’s environment is the increased demand that people are putting on the little available resources (Ahlburg, Kelley & Mason, 2006). Implications of the issues on business The above discussed issues of population growth has a number of negative implications on business. As mention above, population growth has brought a lot of harm to the planet. For those areas where the environment is highly polluted people tend to move other safer areas (Hinrichsen& Robey, 2000). This is highly happening in China and Europe, thus leaving the polluted areas with little population. Imagine running a business in such an area (Shriver, et all 2006). The business owner will not only face the challenge of low customers, but also he will also suffer when it comes to hiring, accessing lenders, and this will force him to start marketing outside his area. Secondly, in china, population growth has resulted in a reduction of both public and private capital information. Most unemployed people are unable to access capital such as bank loans. This has highly affected business growth in the country, although it is ranked as one of the developed countries in the world (Hogan, 2005). Europe, on the other hand, is faced with the crisis of the reduced capital stock per worker. This has resulted in the capital per worker to reduce to its steady state, thus leading to a reduction in production output (McMorrow&Roeger, 2004). References Ahlburg, D. A., Kelley, A. C., & Mason, K. O. (2006). The impact of population growth on well-being in developing countries. Berlin: Springer. Bramall, C. (2007). Industrialization of rural China. Oxford, Oxford University Press. Dorfman, M. C., Holzmann, R., OKeefe, P., & World Bank. (2012). Chinas pension system: A vision. Washington DC: World Bank. Dutta, M. (2006). Chinas industrial revolution and economic presence. New Jersey: World Scientific Pub. Fang, H. (2012). The post-war industrialization of China. Washington: National planning Association. Frank, A. G. (2011). The Great Divergence: Europe, China, and the Making of the Modern World Economy. By Kenneth Pomeranz. Princeton: Princeton University Press, 2000. 382 pp. $39.95 (cloth). The Journal of Asian Studies, 60(01), 180-182. Hinrichsen, D., & Robey, B. (2000). Population and the environment: The global challenge. Johns Hopkins University School of Public Health, Center for Communication Programs, Population Information Program. Hogan, D. (2005). Population, poverty and pollution in Cubatao, Sao Paulo. GeographiaPolonica, 64, 201-224. Ikels, C. (2006). The return of the god of wealth: The transition to a market economy in urban China. Stanford, Calif: Stanford University Press. Izazola, H., & Marquette, C. (2005). Migration in response to the urban environment: outmigration by middle-class women and their families from Mexico City after 1985. GeographiaPolonica, Warsaw, Polish Academy of Sciences, (64), 225-256. Kueh, Y. Y. (2008). Chinas new industrialization strategy: Was Chairman Mao really necessary?. Cheltenham, UK: Edward Elgar. Lin, J. Y. (2013). Chinas economic development and cultural renaissance in the multipolar growth world of the twenty-first century. China Economic Journal, 6(1), 1-11. Liu, F. (2012). ‘Politically indifferent’nationalists? Chinese youth negotiating political identity in the internet age. European Journal of Cultural Studies, 15(1), 53-69. McMorrow, K., &Roeger, W. (2004). The economic and financial market consequences of global ageing. Berlin: Springer. Narayanasamy, S. (2003). Youth development in the new millennium. New Delhi: Discovery Pub. House. Schucher, G. (2014). A ticking" time bomb"? Youth employment problems in China (No. 258). GIGA Working Papers. Shriver, A. L., University of Portsmouth., WorldFish Center., Consultation on the Impact of Global Climate Change on Aquatic Resources, Food and Income Security of Fishing-dependent Populations, & Workshop on Economic Effects of Climate Change on Fisheries. (2006). Annotated bibliography on the economic effects of global climate change on fisheries. Penang, Malaysia: WorldFish Center. Sigurdson, J. (2007). Rural industrialization in China. Cambridge, Mass: Harvard U.P. Xi, J. (2006). Chinese youth in transition. Aldershot [u.a.: Ashgate. Yueh, L. (2013). What Drives Chinas Growth?.National Institute Economic Review, 223(1), R4-R15. Read More