The unemployment allowance for residents has been raised to help the jobless cope as they look for new work, the municipal government has said.
Starting this month, the maximum monthly unemployment allowance will be 600 yuan ($88), an increase of 50 yuan, while the minimum allowance the jobless can receive will be 435 yuan, a 20 yuan increase, the Shanghai municipal human resources and social security bureau said in a notice on Wednesday.
"The changes were made to help maintain the aid given to the unemployed and motivate them to look for new work," the bureau said.
Any unemployed Chinese citizen aged 18 to 60 who is a permanent resident of the metropolis and has difficulty finding work is eligible to receive the allowance for up to two years, the bureau said.
Under the newest regulations, the amount recipients can get will vary from 495 yuan to 600 yuan in the first year, depending on how long they have been paying unemployment insurance.
For the second year, aid will range from 435 yuan to 480 yuan.
Authorities also raised the amount of aid for individuals who suffer from work injuries and for the families of those who died on the job, with amounts increasing from 100 yuan to 360 yuan for such cases.
The increases in the allowances are in line with changes in average salaries, said human resources consultant Qiu Jie.
The city's average salary last year stood at 3,292 yuan, a 400 yuan or 13.8 percent jump from the previous year, the municipal statistics bureau said last month.
"The rise in social welfare provisions also increase employers' manpower costs, which could inhibit hiring in this tight job market," Qiu said.
Employers' contributions to social welfare funds are taking up an increasing proportion of their manpower costs, amid tougher new regulations under the labor law that calls for severe penalties for bosses who fail to make such contributions, said Qiu.
"Many employers prefer to hire retirees than fresh graduates because they don't have to pay such insurance for the retired," she said.
As of mid-March, more than 70 percent of Shanghai's 158,000 upcoming university graduates have not yet secured a job. Usually, more than 70 percent would have found a job by then.
"It is true government is paying fresh graduates for internship at companies to gain some experience," she said, "But one-year internships may not lead to employment and many graduates are unwilling to do that.
"I would suggest government compensate employers for social welfare insurance in difficult times, to lower their human resources costs."
Source: China Daily