Changes in the Distribution of Migrant

Labourers and Implications of Comprehensive

Wealth in China’s Urbanisation

Jinhyoung Kim
Division of Chinese Foreign Affairs and Commerce, Hankuk University of
Foreign Studies, 107, Imun-ro, Dongdaemun-gu, Seoul 02450, Republic of
Korea.
kimjh@hufs.ac.kr

This study applies the comprehensive wealth framework (CWF) to more fully assess the regional impacts of
changes in the distribution of migrant workers in the recent urbanisation of China. The analysis indicates
that changes in the distribution of migrant labourers have contributed to sustaining or increasing GDP
growth rates and the level of human capital in both central and western regions. However, there is evidence
that social and political capital may have declined along with the inflow of the mobile labour force and
some lowered local government investments. From the perspective of the CWF, this study concludes that
the impacts of distributional changes on regional comprehensive wealth is uncertain, potentially reducing
the comprehensive wealth of the region.

Keywords: Migrant labourers, comprehensive wealth framework, National New-

Type Urbanisation (the Plan), China’s urbanisation, mobility of capital, sustainability

INTRODUCTION

The most mobile labour force in China are the rural migrant labourers (nongmingong;
Zhu 2007), totalling more than 290 million in 2019 on the basis of the Annual
Report on the Survey of Migrant Workers’ Monitoring (nian nonmingong jiance diao-
cha baogao). In modern Chinese developmental history, especially after the Southern
Tour of Deng Xiaoping in the early 1990s, migrant labourers have been a crucial
source of abundant and relatively cheap labour for urban capitalists (Mohabir et al.

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Sage Publications Los Angeles/London/New Delhi/Singapore/Washington DC/
Melbourne
DOI: 10.1177/00094455211027361
172 Jinhyoung Kim

2017; Takada and Li 2014).1 In particular, the massive influx of migrant labourers
from rural areas has played a crucial role in expanding the manufacturing sector and
low-end services, which has contributed to rapid urban expansion, as well as regional
gross domestic product (GDP) growth, especially during the 1990s and the early
2000s (Fang et al. 2009; Knight et al. 1999; Mohabir et al. 2017).
Currently, several studies have reported that the shortage of migrant workers
(called mingong huang in 2004) and slowed economic growth in the eastern coastal
region have weakened the role of the migrant labourers in economic activity since the
second half of the 2000s (Chen et al. 2018; Mohabir et al. 2017; Wang et al. 2015). In
March 2014, the Communist Party of China (CCP) and the State Council of China
jointly announced the National New-type Urbanisation Plan 2014–2020 (hereafter,
the Plan), with a primary focus on people-oriented urbanisation for sustainable
urbanisation as their central development strategy (New Urbanization Plan 2019).
The Plan, in particular, focuses on sustainable urbanisation as an engine of economic
growth and involves reallocation and reclassification of the migrant labourers (Chen
et al. 2017; Guan et al. 2018; Wang et al. 2015). Given the spatially uneven and
ongoing urbanisation in China, this implies the importance of migration to sustainable
urbanisation. Put another way, reallocation of migrant labourers is a key to sustainable
urbanisation in many middle and western regions that currently have lower levels of
urbanisation and economic development than in the eastern region.
However, several reports have found evidence of significant social costs and tensions
from the inflow of rural migrants into urban areas. Based on the Chinese household
registration (hukou) system, most migrant workers have only a temporary residential
status in urban areas. Furthermore, migrants lack the benefits of a full range of goods,
services and assets that permanent residents enjoy (Zhu 2007). Migrants, who do not
have full legal residential benefits, do not want to invest their time and money in the
urban regions where they currently live and work, resulting in increased social tensions
and costs (Fang et al. 2009). The lack of social belonging phenomena by many of the
current migrant workers in cities leads to an erosion of social capital2 (Mohabir et al.
2017; Zhong et al. 2016). In addition, the hukou system is not only a restriction on
their mobility but also limits freedom of choice as Chinese citizens (political rights as
political capital, Hong 2015). In this sense, it is hypothesised that if migrant workers
are less likely to receive the urban hukou (reclassification), then they are likely more
mobile and thus less likely to contribute to urban social and human capital, although
they are positively associated with the secondary industry and urban expansion.

1  
This rationale was explained by several urbanisation theories and the well-known Lewis model (or Lewis
turning point).
2  
The concept of social capital is poorly defined in the literature, and as Fine (2010) argues, it is frequently
used to include a broad array of imprecise concepts. In the comprehensive wealth framework (CWF), it
is narrowly defined as assets that individuals can access to reduce their costs and increase their benefits in
social interactions.

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 Changes in the Distribution of Migrant Labourers and Implications 173

This study aims to track changes and patterns of migration with the consideration of
their social and economic impacts in a sustainable manner. With this purpose, this study
raises the following questions: How are the migrant labourers distributed (since mingong
huang in 2004)? What are the social and economic impacts/consequences of the changes
in the distribution of migrant labourers? What are the implications of migration on
sustainability? To answer these questions, this study applies the comprehensive wealth
framework (CWF; Pender et al. 2014). The CWF extends financial indicators of
economic performance to include a broader definition of wealth.3 It incorporates all
monetised and non-monetised, private and public, tangible and intangible assets. It
is based on an inclusive definition of income given by William Nordhaus, the 2018
winner of the Nobel Prize in Economic Sciences. Nordhaus’ analysis described the
relationship between sustainable income and sustainable wealth, including monetary,
non-monetary and publicly provided goods and services, defining sustainable income as
the sum of comprehensive consumption and net investment in comprehensive capital
(Nordhaus 1995, 2000).4 From the perspective of the CWF, it might be expected that
the contribution of migrant workers to sustainable urbanisation is not as positive as
suggested by narrow financial indicators, such as regional GDP growth. This study
demonstrates how the CWF describes the range of consequences in the urbanisation
process in China and so explains the impacts of migration on comprehensive wealth,
and thus sustainability. Finally, it provides important implications of the success of
policies, which leads to increased migration.

A BRIEF DESCRIPTION OF THE COMPREHENSIVE WEALTH FRAMEWORK:

MOBILITY AND SUSTAINABILITY

Over the last few decades, several efforts have been made to more rigorously define
the concept of sustainable economic growth and well-being by including non-
monetary assets in assessing macroeconomic performance (e.g., the Index of
Sustainable Economic Welfare, Cobb and Daly 1989; the Human Development
Index, Sen 1994; Integrated Environmental-Economic Accounting, United Nations
2003; the Genuine Progress Indicator, Cobb et al. 1995; Genuine Wealth, Anielsky

3  
Standard wealth measures include tangible, marketable forms of natural, intellectual, built and financial
capital but do not include non-marketable assets, such as social and political capital. The CWF adds the
non-marketable assets that contribute to well-being or quality of life, avoiding double counting of the
marketable elements (Kim and Johnson 2020).
4  
The conceptual rationale of Nordhaus’ (2000) analysis was the following: ‘when the national accounts
include all market and non-market stocks of capital and other dynamic features that affect production and
when capital stocks are valued at the appropriate scarcity prices, net domestic product is an accurate measure
of sustainable or Fisherian income’ (p. 4), importantly implying that ‘extending the national accounts to
include comprehensive measures of consumption and net investments is likely to make output and income
more accurate indexes of sustainable income’ (p. 4).

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174 Jinhyoung Kim

2007; Comprehensive Wealth, Arrow et al. 2007, 2012; and Inclusive Wealth, United
Nations University, 2014). Most of these expand the standard definition of wealth by
adding indicators of non-monetary assets, such as human and natural capital, but
exclude many types of non-monetary costs and benefits (Kim and Johnson 2020).
The CWF includes non-monetary forms of capital, such as social and political
capital, ignored by other frameworks. It defines sustainable economic growth5 as an
increasing or non-decreasing level of comprehensive capital (Kim and Johnson 2020).
This study focuses on the mobility of capital and the interactions among capitals caused
by these flows of external capital.
A key concept in this article is the distinction between people- and place-based
wealth. Mobility of capital is defined as ‘the ability of individuals to take the capital
with them when they move’ (Johnson 2014, 209). This mobility concept helps to
differentiate people-based wealth (‘the wealth owned by the residents of a region’,
Kim and Johnson 2020, 2) from place-based wealth (‘the wealth physically existing
within a geographic region’, Kim and Johnson 2020, 2). People-based assets are mobile
(e.g., human capital), whereas place-based assets are immobile in general (e.g.,
infrastructure, buildings and local public services). When people migrate, their
originating region loses some assets, such as human capital (e.g., labour force), and
the external benefits of these are lost to those who remain (Johnson 2014; Pender et
al. 2014). In this sense, tracking the extent of mobility of people-based assets and its
impact on regional wealth helps understand regional sustainability.
Urban–rural dual household registration (hukou) system is a China-specific
institution that affects regional wealth as measured by the CWF. In China, the urban
population is a mix of rural and urban hukou. A limit on sustainable and complete
urbanisation is created because rural migrants live and work in urban areas but do
not receive urban hukou. This leads to incomplete and ultimately unsustainable
urbanisation6 (Chen et al. 2018; Kroeber 2016). This is because the rural migrants
who hold the rural hukou are not entitled to the same social services as urban hukou
holders (Guan et al. 2018, e.g., ‘full access to social services, such as public schools
for their children, medical care, and pension plans’, Kroeber 2016, 72). However,
it is difficult for rural migrants to earn the urban hukou unless they have professional
skills and have enough money for urban housing (Chan and Buckingham 2008).
Although several reforms have been implemented (e.g., currently, reform of the
Household Registration System (HRS) in 2014 and residence permit in 2015; Chen
et al. 2018), services available to rural migrants are still limited compared to permanent
urban citizens. Furthermore, currently some reports indicate that in situ urbanised
rural residents who have obtained urban hukou still cannot access some urban public

5  
In this article, the term sustainability corresponds to the concept of weak sustainability. Weak sustainability
requires non-decreasing comprehensive wealth and maintenance or surpassing of current standard of living
indefinitely based on an economic value principal (Pearce et al. 1994). In contrast, strong sustainability
requires conservation of the total stock of natural capital based on a physical principal (Daly 1991).
6  
This refers to widened disparity of the living conditions among Chinese urbanites (Kroeber 2016).

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social services, such as the healthcare system, which depends on the local governmental
fiscal conditions (Chen et al. 2017). It might be more problematic that most local
governments pay less attention to improvements in public services because of their
investment priority on capital-intensive industry and infrastructure development
(Kim and Jung 2020b; Kroeber 2016). The result is labour market distortions that
lead to social and economic costs (e.g., inequalities of wages and social discrimination
between the urban and rural hukou holders, especially rural migrants, and limitations
on upward mobility; Kroeber 2016). The hukou system influences both social and
economic structures and is important to the urbanisation process in China. As Hong
(2015) argued, systemic restrictions and discrimination on the basis of the hukou
system do not simply involve sanctions on migrant workers’ ability to move (labour
mobility); it also limits other types choice of Chinese citizens (political rights). For
the rural migrants, equal rights of access to social and economic opportunities and
successful adjustment to urban life largely depend on changes in their hukou status
from rural to urban (Chan 2010; Chen et al. 2016).
This study relates the notions of social, human and political capital7 to that of
comprehensive wealth. The mobility of rural migrants can be an important source of a
region’s social-capital decline. This is because reallocation of labour by economic changes
can destroy social capital by changing community structure (Routledge and von Amsberg
2003), which can cause declines in private and public wealth. As Mohabir et al. (2017)
and Zhong et al. (2016) indicate, most rural-to-urban migrants in China are temporary
workers and are not interested in the local community or neighbourhood mainly because
of their limited resources and rights due to their hukou status. As a result, they are isolated
from the urban community, lacking a sense of belonging to the city.
In the CWF, the benefits of human capital include non-monetary benefits related
to social status and security, whereas the traditional approach of human capital
measurement follows directly from the value of built capital (Kim and Johnson 2020).
Again, in China, the social status related to the hukou can erode the non-monetary
benefits of the migrant workers in a city. As mentioned earlier regarding political capital,
the hukou system for rural migrants affects their political capital, which refers to their
rights as Chinese citizens (Hong 2015). This China-specific institutional constraint
determines the differences in resources available between the urban and rural hukou
holders in a same region. While rural migrants in urban areas invest in the social, human
and political capital of the urban region, they are also mobile, which can affect the
level of regional comprehensive wealth. Those residents who are more mobile would
be less likely to fully integrate into the regions where they currently work and live.

Herein, this study follows definitions of social, human, and political capital by Pender et al. (2014) as follows:
7  

social capital as ‘the stock of trust, relationships, and networks’ (p. 19) among members of a community or
population, human capital as the stock of people’s education, experience, skills, and physical and mental
health (Becker 1962), and political capital as the stock of ‘power, and goodwill held by individuals, groups,
and organisation that can be held, spent, or shared to achieve desired ends’ (p. 19).

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176 Jinhyoung Kim

CHANGES IN THE DISTRIBUTION OF RURAL WORKERS AND THE IMPACTS

ON CHINESE URBANISATION

Chinese officials and scholars have generally considered sustainable urbanisation as a

major driver of economic growth (Guan et al. 2018; Kroeber 2016). And, the Chinese
government has long attempted to use rural labourers for urbanisation with some
relaxation of the hukou system through national-level policies (Chen et al. 2018;
Guan et al. 2018; Kroeber 2016). This section explores the literature concerning
ways in which the Chinese government has taken advantage of the use of rural work-
ers and how their migration has interacted with economic development in the
Chinese urbanisation process since the reform and open policy of 1978.
In the early stage of urbanisation between 1978 and the early 1990s, many farmers
transitioned from traditional agriculture to modern urban industry. The rapid rise in
productivity due to this labour transfer was the most important contributor to faster
economic growth in China, accounting for one-fifth of the increase in the GDP during
that period (Guan et al. 2018; Kroeber 2016; Wei 2018). However, this movement of
people off the farm into the modern sector did not fully transfer the comprehensive
capital of the rural labour force, since most rural migrant labourers did not bring their
families with them because there were not enough economic and social incentives
(e.g., low income and poor living condition in factory dormitories, Kroeber 2016).
During this period, interprovincial and rural-to-urban migration was restricted by the
government (Fang et al. 2009), dividing the pool of workers into rural and urban labour
forces according to their place of origin (Chan and Wang 2008; Fan and Sun 2008; Li
et al. 2016).
As a result of Deng Xiaoping’s Southern Tour in the early 1990s, the Chinese
government started to emphasise rural-to-urban migration with some relaxation of
labour mobility.8 Following the relaxation of limits on mobility of the labour force,
massive interprovincial migration occurred since the early 1990s (e.g., 9.2 million
in 1990–1995, 32.3 million in 1995–2000 and 38.0 million in 2000–2005; Chan
and Wang 2008). Also, the number of rural migrants with another province’s hukou
increased after 1995 (e.g., 9.3 million in 1995, 42.4 million in 2000 and 47.7 million
in 2005; Chan and Wang 2008).9 As Chan and Wang (2008) have noted, the influx
of migrant labourers10 into the regional labour force was positively associated with

8  
But the migrant workers needed to bear additional costs to enter a city to work, because they needed
to get an employment license and the temporary living certificates in addition to the card based on their
hukou (Fang et al. 2009).
9  
According to Chan and Wang (2008), the 1995 and 2000 data might suffer from being less accurate:
‘The 1995 data on the population and migrants have been undercounted at a province and the 2000 data
on the non-hukou population have slightly been overcounted’.
10  
Chan and Wang (2008) deal with the complexities of Chinese official statistics. For the demographic
statistics, they consider two different types of population counts: the de jure in the regular annual provincial
population series and de facto population statistics in the census.

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reductions in interprovincial inequality during the second half of the 1990s. In

general, labourers moved from the middle and western regions to the eastern region
of China,11 with migrant inflows into the eastern region accounting for 80% of total
interprovincial migration for 1990–2005 (Takada and Li 2004). This migration has
had profound effects on regional economies, driven by ‘the employment opportunities,
higher income and different lifestyles in cities’ (Li et al. 2016, 516).12
The rapid economic growth has been accompanied by rapid urbanisation (called the
‘building-binge phase of urbanisation’, Kroeber 2016). In particular, the massive inflows
of migrant labourers into urban areas have contributed to the level of urbanisation (e.g.,
a province’s urban population, which, according to current Chinese official statistics
criteria means those who live in urban areas for more than 6 months, increased from
12 million in 1978–1998 to 21 million in 1998–2013; Kroeber 2016, 70). And, the
increasing numbers of migrant workers in urban areas need more housing with more
infrastructure, such as roads and sewers, and thus leading to the construction of housing
and infrastructure (Kroeber 2016). This has created new employment opportunities and
thus directly contributed to the physical growth of cities (Kroeber 2016; Wei 2018).
Currently, several studies have reported a plateau of urbanisation (Kroeber 2016),
because an increasing number of migrant workers do not want to move to a city (Chen
et al. 2018; Mohabir et al. 2017). This has led to declining migrant labourer supply in
some regions (e.g., mingong huang; Minami and Ma 2014) and thus moderation in the
rate of urbanisation (Chen et al. 2018). However, the pattern can at least partially be
attributed to changes in the economy of the eastern coastal region. To be specific, as
the eastern region has achieved a higher level of urbanisation, its economic structure is
transitioning from secondary to tertiary industry. Therefore, this region has a different
demand for labour force, leading to a reallocation of many of the migrant labourers.
The middle and western regions have lower urbanisation levels and a different economic
structure than the eastern region; here there is more room for the migrant labourers
to play a role in economic activities.
Currently, the Plan by the National Development and Reform Commission
(NDRC) involves urban development based on clusters among the axes that interlink
economies between regions, thus relaxing the regional inequalities between advanced
and lagged regions (New Urbanization Plan 2019). To encourage sustainable
urbanisation, the Plan promotes urban development strategies that involve industrial
development and thus aims to absorb more of the labour force (Li et al. 2016). Given

11  
A more specific pattern of migration between 1990 and 1995 was from the western area of Sichuan
(outflow: 1.32 million in 1990 and 1.46 million in 1995) to the eastern coastal area of Guangdong (inflow:
1.26 million in 1990 and 1.95 million in 1995), according to Takada and Li’s (2014) analysis. The ratios
of outflow from the central part of China, such as Jiangxi, Hubei, Hunan, Henan and Anhui provinces,
were even higher than those from western China in terms of residential population (Takada and Li 2014).
12  
Li et al. (2016) discuss several issues of involuntary migration in urbanisation processes during the
1980s and 1990s (e.g., migration resulting from land acquisition, as well as environmental degradation
or climate change).

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178 Jinhyoung Kim

this development strategy, this study expects that the middle and western regions,
which have more opportunities in industrial development than the east, will require
more migrant labourers than the east.
As Fang et al. (2009) point out, reallocation and reclassification of migrant labourers
has the potential to enhance the accumulation of regional human capital and intensify
the linkage between human capital formation and the labour market of a region. In
particular, use of migrant workers in many of the middle and western regions would
contribute to a rising comparative advantage in labour-intensive industries and more
rapid urbanisation.

Changes in the Distribution of Migrant Labourers and Implications for

Regional Comprehensive Wealth

This section analyses changes in the flow of migrant labourers, considering regional
economic structure. To operationalise the notion of comprehensive wealth and to
provide a consistent comparison with the changes in the distribution of migrant
labourers, this study is limited to regional-level indicators; however, some indicators
are computed on the basis of the provincial level.
As indicated earlier, the widened gap between migrant residents and urban hukou
residents limits the non-monetary benefits and wealth of migrant workers in a city,
such as limits on freedoms (Hong 2015) and sense of belonging to the city (Mohabir
et al. 2017; Zhong et al. 2016), which in turn reduces regional levels of political and
social capital. Thus, this study posits that inflows of migrant workers into urban
areas are negatively associated with the levels of social and political capital in those
areas unless they are reclassified. This study further looks at changes at the levels of
the urban population, urban-registered population and migrant labourers, as well
as changes at the level of human capital and the evolution of regional economic
structure. Finally, this study investigates the flows for public wealth from local
governmental expenditure.
There are two types of migrant workers: intra-area (local) and inter-area (out-
of-region) migrant workers. Figure 1 indicates changes in the number of total
migrant labourers between 2008 and 2019, including intra-area and inter-area
migrant labourers. Regionally, the decrease in the numbers of both intra- and inter-
migrant workers in the eastern area is larger than the increase in the numbers of
both intra- and inter-migrant workers in both central and western areas (see Table A1).
Thus, the deceleration effect since 2014 is mainly affected by the eastern area. Also,
the Plan implemented several reforms in the hukou system (e.g., residence permit in
2015, rural population transference and non-resident population settling in the city
in 2016; Chen et al. 2018); these efforts might be related to the deceleration of the
levels since 2014.
To identify how migrant workers are reallocating, this study investigates changes
in the regional levels of urban population, urban-registered population and migrant

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Figure 1
Changes in the Levels of Migrant Labourers by Total, Intra- and Inter-area Migration, 2008–2019

Source: Annual Report on the Survey of Migrant Workers’ Monitoring for various years.

labourers (Figure 2).13 It defines the difference between urban population and urban-
registered population as the floating or mobile population. For the eastern region, the
level of the floating population has been increasing, but the level of migrant workers
has been decreasing, especially after 2012. This means that different types of workers
other than migrant workers are contributing to the floating population pool in urban
areas of the eastern region. Also, although younger people from rural villages continue
to migrate to the city (Mohabir et al. 2017), a larger number of migrant workers are
old or have difficulty finding suitable jobs in cities in the eastern region, and thus
many return to rural areas (Chen et al. 2018).
In contrast, the increase in the floating population in urban areas in the central
and western regions has very closely tracked the increase in migrant labourers. The
population registered as long-term urbanites numbered about 62.1 million between
2014 and 2018 (the Plan’s period) at the national level, but this indicates an unequal
regional distribution. In particular, the rate of increase in the urban-registered
population (the rate of transformation into urban hukou) in the central region (2.82%
for 2014–2018) is much lower than that in the western region (5.54% for 2014–2018).

13  
On 24 July 2014, the State Council of China announced that dualised urban and rural hukou
registration unifies to resident registration (jumin hukou). The data on the agriculture and non-agriculture
population have been unavailable since then. This study employs data on the urban-registered population
(gediqushizhonghushu, zongrenkou; Yearbook of Population and Employment Statistics in China, NBS)
instead of the urban-hukou population. It acknowledges that the urban-registered population is larger than
the urban-hukou population in general.

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180 Jinhyoung Kim

Figure 2
Changes in the Levels of Urban Population, Urban-Registered Population and Migrant Labourers

Source: Data on urban population were retrieved from the National Bureau of Statistics, those on urban-
registered population were retrieved from the Yearbook of Population and Employment Statistics in China
by the National Bureau of Statistics, and those on migrant labourers were retrieved from the Annual Report
on the Survey of Migrant Workers’ Monitoring.

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This might mean that the floating population pool is larger in the central region than
in the western region; it is assumed that they are migrant workers and, thus, would
be more mobile. This may lead to greater erosion in political and social capital in the
region and, thus, to declines in comprehensive wealth.
Although the level of the total migrant workers is increasing at the national level
(Figure 1), the regional distribution would be different given the changing demand
based on regional differences in the economic structure and urbanisation levels. Table 1
indicates changes in the regional distribution of total migrant labourers. The proportion
of the migrant workers in the eastern region is decreasing, whereas the proportions
of migrant workers in both western and central regions are increasing through the
entire period. Relatively large reductions in the proportion in the eastern region and
expansion in the central and western regions occurred after 2012. This is consistent
with increasing trends in the floating population in all three regions, as presented in
Figure 2. In particular, the number of total migrant workers in both the central and
western regions expanded from 75.34 to 129.49 million between 2009 and 2018.
Compared with the total 172.58 million employed persons in urban units in 2018,
this is quite a large expansion. It seems that the declining proportion in the eastern
region is reallocating into that of the central and western regions.
This study created an indicator for urbanisation which involves the level of
reclassification of the migrant labourers if they are fully integrated into the destination
place, which is different from the general urbanisation indicator (refer to Table A2
for the general urbanisation indicator). This indicator captures the population level

Table 1
Changes in the Regional Distribution of Total Migrant Labourers, 2009–2018 (%)
Year Eastern Central Western
2009 67.2 17.1 15.7
2010 67 17.1 15.9
2011 65.4 17.6 16.7
2012 64.7 17.9 17.1
2013 60.1 21.2 18.4
2014 60.0 21.1 18.6
2015 59.4 21.5 18.8
2016 56.7 23.6 19.5
2017 55.8 23.8 20.1
2018 54.8 24.1 20.8
Source: Annual Report on the Survey of Migrant Workers’ Monitoring for various years.
Note: From 2016 to 2019, the data on migrant labourers were extended from three to four economic
regions and reported according to these four regional classifications. The north-eastern region includes
Liaoning from the previous eastern region and Jilin and Heilongjiang from the previous central region.
Thus, the data on eastern and central regions exclude numbers of those provinces since 2016. The north-
eastern region has a constant level of distribution, about 3.4%. More details about data compiled by the
author are provided in Appendix A.

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182 Jinhyoung Kim

Figure 3
Urbanisation Indicator

Source: National Bureau of Statistics.

Note: This indicator is calculated as follows:

Urbanization rate # *1 - e o4, where A refers to ‘Population, residing in the townships,

A+B
urban population
towns and street communities with permanent household registration elsewhere having been away from
that places for more than 6 months’ (NBS) and B refers to ‘Population, residing in townships, towns and
street communities, with permanent household registration unsettled’ (NBS). Urbanisation rate, in general,
is calculated as the urban population divided by the total provincial population multiplied by 100.

regarding changes in the hukou status, which considers reclassification by the Plan. In
Figure 3, higher values mean that there are few workers with another place’s hukou and
few people waiting to get the current place’s hukou, which might influence regional
political capital. This indicates that all regions are increasing their urbanisation levels
to a different extent. The increasing urbanisation rates between 2011 and 2019 are
12% for the eastern region, 15% for the central region and 23% for the western
region. The central region has a larger floating population than the western region, as
identified previously, and is less reclassified, implied in Figure 3. This might mean that
the floating population is less likely to integrate into the region where they currently
live and work. For the eastern region, increases in outflows of migrants might influence
the level of population who want to change their hukou status.
Changes in economic structure affect the labour demand in general. Figure 4
shows economic structural changes by three economic regions for 2005–2019 in
percentage terms. For the eastern region, the expansion trend of the tertiary sector
has accelerated since 2012, which coincides with the shrinking in the proportion of
migrant workers in Table 1. The eastern region might have the continued phenomena

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Figure 4
Economic Structural Changes by Three Economic Regions, 2005–2019

(Figure 4 continued)

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184 Jinhyoung Kim

(Figure 4 continued)

Source: National Bureau of Statistics.

Figure 5.
Human Capital by Three Economic Regions (Billions of 2005 yuan)

Source: Human capital index from China Center for Human Capital and Labour Market Research (CHLR).

of mingong huang, which refers to the shortage of migrant workers, but the migrant
workers have been replaced with a different type of human capital due to structural
economic changes. The economic structures of both the central and western regions
are more heavily based on secondary industry, compared with the national levels.
The current economic structures based on primary and secondary industries in
the central and western regions are similar to that of the eastern region in the early
and late 2000s. Therefore, these regions would experience weaker labour demand
for migrant workers owing to the transformation of their economic structure to a
tertiary-based economy.

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 Changes in the Distribution of Migrant Labourers and Implications 185

Figure 5 indicates changes in the level of human capital between 2005 and 2018.
In 2018, the level of human capital in the eastern region was larger than the combined
levels of human capital in both the central and western regions. Those 2018 levels in the
central and western regions are similar to 2005 levels in the eastern regions. Changes
in the level of human capital were 12.29% for the eastern, 9.70% for the central and
9.86% for the western regions during 2006–2010, 7.83% for the eastern, 8.16% for
the central and 8.37% for the western region during 2010–2015 and 5.95% for the
eastern, 6.60% for the central and 7.81% for the western during 2015–2018. All
levels for all three regions were increasing but were different rates. The distributions
of the migrant workers in both the central and western regions showed relatively large
expansion after 2012, as seen in Table 1, which might have contributed to the level of
human capital in those regions. It is important to note that while the inflows of migrant
workers into the central and western regions have contributed to increases in the levels
of their regional human capital stock, they have not contributed to relaxation of the
unequal distribution of human capital among the three regions. This might be due,
in part, to the flows of lower-quality human capital in the central and western regions
than in the eastern region, thus indicating that unequal spatial distribution of human
capital among the three regions has worsened. Furthermore, it implies the need for
more investments on migrant workers, such as in their education and job training.

Table 2
Level and Growth of GDP Per Capita by Three Economic Regions, 2006–2019
(in constant 2005 prices)
Year Average Annual Growth Rate (%)
2006– 2010– 2015– 2014–
Indicator 2006 2010 2015 2019 2010 2015 2019 2019
Provincial GDP per Capita
Mean (yuan) 18,339 28,606 39,684 47,715 12.06 8.03 4.40 4.51
CV 0.627 0.520 0.455 0.487
Eastern (yuan) 29,575 43,269 57,551 68,409 10.38 6.82 4.27 4.33
Central (yuan) 13,073 21,776 30,871 36,948 13.70 8.97 4.21 4.30
Western (yuan) 11,551 19,719 29,183 35,924 14.62 9.77 4.80 4.98
Eastern/central ratio 2.26 1.99 1.86 1.85
Eastern/western ratio 2.56 2.19 1.97 1.90
Source: National Bureau of Statistics, retrieved on 3 May 2020.
Note: This study employs the unweighted coefficient of variation (CV) to check the regional convergence
effect as follows:

| Ni = 1 (y i - yr ) N
2

Coefficient of variation (CV ) =

yr
,where yi is the per capita GDP of province i, N is
the number of provinces (31 provinces) and yr is the mean of yi. The provinces for each area follow the three
economic regions of the National Bureau of Statistics’ (NBS) official regional classification.

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186 Jinhyoung Kim

The Plan focuses on a better regional balance (Wang et al. 2015), and income
convergence is one of the components of convergence in comprehensive wealth.
Chan and Wang’s (2008) analysis showed that the massive influx of migrant workers
from the central and western regions to the eastern region contributed to reduction of
interprovincial inequality during the second half of the 1990s (after Deng’s Southern
Tour). The reallocated labour of the rural workers into the urban manufacturing and
low-end service sectors has influenced economic growth levels at the national level and
has contributed to relaxation of interprovincial inequality. But the gap in the levels of
economic development between the eastern and the other regions expanded during
that period (e.g., discussion of expanded regional inequality between the eastern region
and the rest in Fan and Sun 2008). Current trends in regional inequality are different
from those of the second half of the 1990s. Table 2 shows decreasing patterns of both
interprovincial (CV) and interregional inequality (eastern–central and eastern–western
ratio). The downward trend is possibly related to government-centred efforts in some
of the central and western regions, such as Western Development Program and Central
Emerging Planning, and currently the Plan’s regional balance strategy, such as clusters
among the axes, in addition to a slowed economy in the eastern region since the last
half of the 2000s.14 Average annual growth rates in both the central and western regions
were higher than those in the eastern region until 2010–2015 period. The central
region’s growth rate dropped below that of the other two regions and the national
average. The western region maintains the highest growth rate.15
Also, the Plan focuses on improving public services for both people-oriented and
sustainable urbanisation (Chen et al. 2018; Guan et al. 2018; Wang et al. 2015), which
are important components to assess public wealth. As seen in Figure 5, relaxation
of regional human capital inequality might require more investment in education.
Also, it might indicate more need for public investments in public health when we
consider in situ urbanised rural residents as reviewed in Chen et al. (2017). This study,
thus, investigates these flows for public wealth from local governmental revenue and
expenditure. Figure 6 indicates changes in the local government’s revenue per capita by
three economic regions between 2005 and 2019. Since 2010, in particular, all regions
have seen sharp increases. These trends are indicative of positive financial impacts of

14  
This acknowledges that the following external factor needs to be considered: The eastern region was more
influenced by the global financial crisis around 2008 than the central and eastern regions, mainly due to
its economic ties with the world economy, which could have led to a greater decline in growth rates than
seen in the other regions (Kim and Jung 2020a).
15  
These facts may be related to the urbanisation process. Regarding the phases of urbanisation, the eastern
region achieved more than 50% of its urbanisation before 2006, which indicates a deceleration phase,
whereas the central and western regions achieved 50% each in 2013 and 2017. Still, the western region
had more provinces with a less-than-50% urbanisation level (e.g., Tibet, Guizhou, Gansu, Yunnan) in
2018, and both the western and eastern regions had provinces with an urbanisation level over 50%. As the
urbanisation levels of the central and western regions become higher, the early urbanisation-related labour
demand (i.e., the migrant workers) will be weakened if not upgraded.

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 Changes in the Distribution of Migrant Labourers and Implications 187

Figure 6
Local Government Revenue Per Capita by Three Economic Regions, 2005–2019 (unit: 100 yuan)

Source: National Bureau of Statistics.

Figure 7
Local Government’s Expenditure by Three Economic Regions, 2007–2019

a. General Public Services as a proportion of Local Government Expenditures

b. Education as a proportion of Local Government Expenditures

(Figure 7 continued)

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188 Jinhyoung Kim

(Figure 7 continued)

c. Public Medical and Healthcare as a proportion of Local Government Expenditures

Source: National Bureau of Statistics.

changes in the regional labour force. Regional comprehensive wealth depends on how
these revenues are used and invested.
Figure 7 shows how the local government’s revenues are used. The general public
services have decreased for all three regions. For public investments in education, there
have been some increasing patterns since 2015, but these have changed to a decreasing
pattern since 2018 for all three regions. Local expenditures on public medical and
healthcare keep pace with a decreasing pattern except in the eastern region. The central
and western regions have lower public investments on these, and they have larger
mobile populations. This might mean higher reduction of public social and human
capital, and thus comprehensive wealth.

Concluding Remarks

This study aims to more fully assess the impacts of changes in the distribution of the
migrant workers in the latest urbanisation process. The analysis in this study indicates
that changes in the distribution of migrant workers have contributed to GDP growth
and human capital in both the central and western regions. However, there is evi-
dence that public social, political and human capital by the local government’s invest-
ments may have declined. In this case, the inflow of the migrant workers into those
regions associated with the non-decreasing floating population may have a negative
influence on private and societal benefits in the region. From the perspective of the
CWF, the impacts of distributional changes on regional comprehensive wealth are
uncertain, potentially reducing regional comprehensive wealth.
Many parts of the western and central regions are transitioning their economy from
the acceleration phase to the deceleration phase of urbanisation and to the next stage

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 Changes in the Distribution of Migrant Labourers and Implications 189

of a more advanced economy; thus, they require a well-established market, coming

out of government-led development. A region with mobile human capital (i.e., non-
reclassified migrant labourers) may lose diverse assets, especially when they are likely
to move out of the region. In China’s institutional context, the inflow of the mobile
labour force also might have a negative impact on some aspects of regional social and
political assets, potentially reducing the comprehensive wealth of long-time residents.
Therefore, governmental investments in residential status for migrant workers should
be continued as a regional sustainability strategy. An influx of migrant workers requires
more public services, but the results of this study indicate that public expenditures on
services have been decreasing. It is unlikely that the local governments can enhance
public services given their development strategy priority on capital-intensive industry
and infrastructure (e.g., Kroeber 2016) and chronic financial deficits in several local
governments, partly due to the local and central government’s incentive structure (e.g.,
Casey and Koleski 2011). Continued governmental efforts to stabilise the flow of the
migrant labourers should be one of the steps considered to promote sustainable and
complete urbanisation. Reclassified migrant workers would have an incentive to invest
in their human, social and political capital, which would expand regional domestic
markets and thus be more sustainable.
This research is an initial attempt to assess the changes in regional comprehensive
wealth. Much work remains to be done to develop a rigorous conceptualisation of
the components of comprehensive wealth, for instance, through identification and
expansion of new data and indicators. This research aims to initiate steps towards
fully measuring comprehensive wealth and exploring the interrelationships among
various types of capital.

DECLARATION OF CONFLICTING INTERESTS

The author declared no potential conflicts of interest with respect to the research,
authorship and/or publication of this article.

FUNDING

The author disclosed receipt of the following financial support for the research,
authorship and/or publication of this article: This work was supported by the
Ministry of Education of the Republic of Korea and the National Research Foundation
of Korea (NRF 2020S1A5B5A17087597).

ORCID iD

Jinhyoung Kim https://orcid.org/0000-0002-1452-7044

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190 Jinhyoung Kim

Appendix A

Table A1
Level of Intra- and Inter-area Migration by Three Economic Regions, 2009–2019
Total Eastern Central Western North-eastern
a. Intra-area migration (unit: 10,000 population)
2009 8,445 5,379 1,849 1,217
2010 8,888 5,590 2,000 1,298
2011 9,415 5,781 2,137 1,497
2012 9,925 6,034 2,273 1,618
2013 10,284 5,518 2,911 1,855
2014 10,574 5,663 2,979 1,932
2015 10,863 5,816 3,017 2,030
2016 11,237 5,709 2,989 2,213 326
2017 11,467 5,716 3,058 2,344 349
2018 11,570 5,692 3,120 2,416 342
2019 11,652 5,624 3,192 2,496 340
b. Inter-area migration (unit: 10,000 population)
2009 14,533 4,638 5,297 4,598
2010 15,335 4,877 5,619 4,839
2011 15,863 5,009 5,805 5,049
2012 16,336 5,157 5,983 5,196
2013 16,610 4,936 6,424 5,250
2014 16,821 5,001 6,467 5,353
2015 16,884 4,944 6,592 5,348
2016 16,934 4,691 6,290 5,350 603
2017 17,185 4,714 6,392 5,470 609
2018 17,266 4,718 6,418 5,502 628
2019 17,425 4,792 6,427 5,555 651
Source: Annual Report on the Survey of Migrant Workers’ Monitoring for various years.
Note: Since 2016, the Annual Report on the Survey of Migrant Workers’ Monitoring has extended the
data on migrant labourers from three to four economic regions and reported the data according to four
economic classifications. The north-eastern region includes Liaoning from the previous eastern region and
both Jilin and Heilongjiang from the previous central region. Thus, data on the eastern and central regions
have excluded numbers of those provinces since 2016.

Table A2
Changes in the Level of Urbanisation among Three Economic Regions
Eastern (%) Central (%) Western (%)
2006 60.04 42.53 36.14
2007 60.71 43.59 37.31

(Table A2 continued)

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(Table A2 continued)

Eastern (%) Central (%) Western (%)

2008 61.51 44.87 38.53
2009 62.29 45.87 39.62
2010 64.22 46.95 41.45
2011 65.07 48.45 42.84
2012 66.06 49.81 44.26
2013 66.87 50.89 45.43
2014 67.57 52.02 46.89
2015 68.28 53.23 48.25
2016 69.21 54.48 49.68
2017 69.97 55.69 51.10
2018 70.69 56.85 52.26
2019 71.21 57.92 53.31
Source: National Bureau of Statistics.
Note: Percentage change in the level of urbanisation equals urban population divided by total provincial
population multiplied by 100.

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