China to reallocate 500,000 coal, steel jobs as Trump promises revival

A man on a tricycle delivers coal in China (Credit: Chris / Flickr)

In his first speech to Congress last night, President Donald Trump reiterated his promise to roll back environmental regulations that, in his words, “threaten the future and livelihood of our great coal miners.” But across the Pacific, Trump’s great economic rival and largest coal producer in the world, China, announced a move in the opposite direction.

“This year we will continue to cut capacity in coal and steel,” Yin Weimin, China’s labor minister, told reporters on Wednesday, according to Reuters. “We will need to reallocate jobs to 500,000 workers.”

Although the reasons cited have been strictly economic – enormous overcapacity due to a slowing economy and global demand – China’s notorious struggle with air pollution has also fueled demands to slow production.

The laid-off workers will enter a job placement program for different positions within the same or different companies, Yin said. They will also have the option of early retirement or be encouraged to start their own businesses.

Furthermore, Yin announced that China will introduce policy this year that would promote the development of new industries, such as internet-related ones, for additional jobs.

The cutback continues an effort begun last year to reduce overcapacity in industries including coal, steel, cement, aluminum and glass, as the country attempts to shift toward consumer-led growth and bring down pollution. Competitors like the U.S. and Europe have also complained that China’s low-cost exports threaten their own industries and jobs.

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In 2016, China reallocated jobs to 726,000 coal and steel workers.

“The whole process was smooth and orderly,” Yin said, according to Agence France-Presse. “There were no major conflicts or issues.”

However, that is only 40 percent of the 1.8 million jobs China said it would eliminate last February, and it hasn’t been quite as peaceful as Yin implied. Thousands of steel and coal workers took to the streets last year to protest lost jobs, late wages and unpaid benefits.

As has become a signature response, President Xi Jinping squashed the protests, dismantled labor rights groups and imprisoned activists. He did, however, also pressure businesses to settle disputes and assign billions of dollars for welfare and retraining programs.

That amount, according to Yin, is 100 billion yuan ($14.54 billion). The government spent more than 30 billion yuan of that fund and created 13.14 million urban jobs, he said. However, according to Reuters, he “did not clarify if it was a gross or net figure of the number of people at work.”

China was expected to announce cuts to cement and glass this year as well, but “Yin gave no indication when that would happen,” the Associated Press said. A report last January estimated that as many as 3 million jobs could be eliminated in the following one to two years.

Still, the Chinese government seems set to press on with its plans to shrink “smokestack” industries, despite the challenges of a rapidly slowing economy. At least on the environmental front, it appears to be a worthwhile effort. Data released Tuesday shows that China’s coal consumption fell for the third year in a row in 2016.

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“China is ploughing money into renewables and reining in its addiction to coal,” Li Shuo, a Greenpeace global policy adviser said in a statement. “As Trump’s rhetoric leaves the world in doubt over what his plan is to tackle climate change, China is being thrust into a leadership role.”

If Trump confirmed anything about the issue in his speech last night, it’s that reviving coal jobs will come first – climate be damned. But feasibility of fulfilling that promise aside, experts have said that automation, not environmental regulations, have been the biggest threat to coal jobs for decades.

“…There is no evidence that the rule [preventing coal mining companies from polluting streams]threatened a significant number of coal mining jobs, or that rolling it back will create new ones,” the New York Times wrote in a fact check of Trump’s speech.

While Trump figures out how to hang on to a cornerstone promise of his campaign, China seems eager to push through the challenging transition into new industries. All eyes are on the two global giants as they take vastly different approaches to securing jobs for their coal workers in a rapidly changing economy.

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About Author

Joanne Lu

Joanne Lu is a South Carolina-based writer and editor dedicated to global development, poverty alleviation and social justice. After a year in Rwanda, she now covers the Asia-Pacific and economics. Find her on Twitter @joannelu or email joanne@humanosphere.com.

  • hikertom

    Coal is the dirtiest form of energy. It should be left in the ground where it will do no harm.