China’s Industrial Upgrade an*d Human Capital Improvement

Zhang Juwei and Gao Wenshu  
Institute of Population and Labor Economics, Chinese Academy of Social Sciences (IPLE-CASS), Beijing, China  
Abstract: Based on statistics, this paper reviews China’s economic growth and industrial  
upgrade since the reform and opening up in 1978 and estimates the contribution of  
industrial restructuring to economic growth. With the years of schooling as the proxy  
variable of human capital, this paper describes changes in China’s labor competence during  
the industrial restructuring process. Then, this paper estimates China’s future human capital  
demand and shortage based on economic and demographic forecast. Lastly, this paper  
proposes recommendations for improving human capital in China with skills development  
and education.  
Keywords: industrial structure, industrial upgrade, human capital, labor competence,  
China, supply-side structural reforms  
JEL classification: L16, J24, O15
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