Guangdong Lowers Insurance Premiums to Save Jobs

The government of south China's Guangdong Province on Thursday vowed to lower company-contributed social insurance premiums by 15 billion yuan (2.2 billion U.S. dollars) this year to save jobs amid the global financial crisis.

Zhang Xiang, a spokesman with the provincial bureau of Labor and Social Insurance, said the policy would help secure 1.9 million jobs in the province this year, which may otherwise face payroll cuts amid the current economic downturn.

He said that Guangdong boasted 240 billion yuan of surplus in social insurance fund last year, which is sufficient to offset the account shortage this year.

The export-oriented manufacturing center has been hard hit by the financial pinch, with 600,000 migrant workers laid off before China's Lunar New Year holiday in late January.

The labor bureau said the government policy will help ease employers' burden of paying premiums for medical care, unemployment and work injuries.

Zhang explained the policy by citing a company with 500 staff as an example. Its total expenditure on social insurance will be slashed by around 20 percent, or 344,000 yuan this year.