Economic reform and the change of employment structure in China

China’s employment structure has changed enormously in the 40-year reform and opening-up, and it is not only a result of economic reform, but also a driving force for economic growth. The paper summarizes main features of this changing process in four stages by employment quantity and proportion. Its achievement includes insistingon positive employment promotion policy, continuing urban employment priority,promoting non-state economy, and developing market mechanist. This is the process of optimizing human capital allocation and increasing labour productivity through transferring labour from low to high productivity areas. Meanwhile, China is facing some new challenges for further development in decreasing working age population and aging society, structural employment difficulty and youth unemployment, imbalance of employment structure, and institutional obstacles. Government needs to reform hukousystem, encourage 2nd and 3rd industries and small-medium sized firms, and reforming tertiary education and vocational training systems.