Labour Market Dynamics of Self-employment in China: The Interplay of Institutions and Gender

Abstract

Self-employment has been regarded as a possible means of job creation and economic stimulation by the central government of China. While self-employed individuals acted as the forerunners of private enterprises in the early reform era and played a vital role in China’s market transition, the pathways to and outcomes of self-employment are conditioned by the changing opportunity structure, retreat of the socialist ideology and dominance of patriarchal norms in capitalist entrepreneurship. Using mixed research methods, I investigated China’s most recent self-employment patterns and outcomes, the disparity between self-employment entry in rural and urban regions, and the impact of institutional transformation on the opportunities available for men and women of different social groups. I argue that self-employment in contemporary China constitutes a reaction to structural disadvantages in access to the labour market and is mainly taken up by people who are socially and/or culturally discriminated against or otherwise disadvantaged. Self-employed individuals suffer from poor job quality and precarious working conditions since their low-paying jobs also tend to involve long and unsociable shifts. However, compared to waged/salaried jobs in privately-owned enterprises, self-employment generates a higher annual income and job satisfaction. It also allows greater autonomy and flexibility for women and rural-to-urban migrants in Chinese cities, while the benefits are largely offset by intensified self-exploitation, vulnerability, distraction and insecurity. I also argue that marketisation has widened the gender gap in employment outcomes and resulted in a different opportunity hierarchy for men and women in urban and rural labour markets. While drawing upon both quantitative and qualitative data, my exploration of self-employment in China during the 2010s represents the first comprehensive study examining the heterogeneity of self-employment in rural and urban China. My empirical findings give rise to new research questions and call for greater attention to the gendered pattern of self-employment participation and performance in China in an increasingly marketised era.