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China Industry
The industrial sector employed only about 17 percent of the
labor force in 1985 but, as a result of much higher labor
productivity than the agricultural sector, accounted for over 46
percent of national income. Industrial units were very diverse in
size and technological sophistication, ranging from tiny handicraft
manufacturing enterprises to giant modern complexes producing such
goods as steel, chemical fertilizer, and synthetic fibers. The
majority of the country's large industrial units were clustered in
the major industrial centers in the northeast, the
Beijing-Tianjin-Tangshan area, the Chang Jiang (Yangtze River)
Valley, and Shanghai. Small and medium-size units were found
throughout the country, and a number of first-rank plants were
located far from the leading cities
(see Geographic Distribution of Industry
, ch. 7). Ownership of industrial enterprises fell into
three general categories: state ownership, urban collective
ownership, and rural collective ownership. Industry was dominated
by the state-owned sector, which included the largest, most
technically advanced, and most important enterprises.
In 1985 state-owned enterprises produced 70 percent of national
industrial output by value, held 75 percent of fixed industrial
assets, and employed 46 percent of the industrial labor force
(including rural industrial enterprises). Although all of these
units were owned by "the state" in the abstract sense, operational
control and effective ownership of specific enterprises were
divided among the different levels of government. A few of the
largest enterprises were under the direct authority of their
respective ministries in the central government. Most major
enterprises were owned by the province, autonomous region, or
special municipality where they were located or were subject to
shared control by the central ministry and the provincial-level
government. Small and medium-size units usually were owned by city,
prefecture, county, or town governments. Control of some
enterprises was shared with higher administrative levels.
Workers in state-owned enterprises were paid regular wages
according to an established pay scale, as well as bonuses that were
supposed to be related to personal or enterprise performance or
both. In addition, they received a number of important benefits,
including free health care, subsidized housing, and subsidies for
such work-related expenses as special clothing and commuting costs.
The average income of industrial workers was considerably higher
than that of most farmers and was much more stable.
Urban, collectively owned enterprises (owned by the workers)
for the most part were small units equipped with relatively little
machinery. Many of these units were engaged in handicraft
production or other labor-intensive activities, such as
manufacturing furniture or assembling simple electrical items. In
the late 1970s and early 1980s, the government promoted them as a
means of using surplus labor to increase supplies of consumer and
export goods. By 1985 urban collective industrial enterprises
employed over 17 million people, 20 percent of the total industrial
labor force. These enterprises held only 13 percent of all
industrial fixed assets but produced 19 percent of total industrial
output value.
Rural, collectively owned industrial enterprises--commonly
referred to as "township enterprises"--were the most rapidly
growing portion of the industrial sector in the mid-1980s. The
government regarded them as a means of expanding industrialization
(without further taxing the overcrowded major urban centers),
alleviating rural unemployment, and increasing supplies of
industrial products in rural areas. Most of the township
enterprises were operated by township and town governments, but a
large number of very small units were operated by private
cooperative organizations called "rural economic unions." In 1985
township enterprises employed 30 million workers, over a third of
the total industrial labor force. The value of their fixed assets,
however, was only 12 percent of the national total, and their
output value came to less than 10 percent of the national total.
Nonetheless, in 1985 their income grew by 44 percent over the 1984
levels. The most common products of township industries were
building materials, agricultural machinery, textiles, and processed
foods.
Data as of July 1987
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