(Yicai Global) March 1 -- China's urban employment fell last year for the first time since 1962, according to official data.

Some 459.3 million people were employed in urban areas at the end of 2022, down 8.4 million from a year earlier, figures from the National Bureau of Statistics showed yesterday. A total of 733.5 million people had jobs in China at the end of last year, according to the data.

There are multiple reasons behind the decline in urban employment, including shrinkage of the working-age population, lower labor force participation, and reduced corporate demand, Zhang Chenggang, director of the jobs research center at Capital University of Economics and Business, told Yicai Global.

Overseas orders continued to fall last year because of the pandemic, leading to a decline in labor demand and fewer rural workers moving to cities, which directly resulted in the drop in urban job numbers, Zhang pointed out.

Even after China eased its Covid-19 prevention and control policy the outlook for the labor market is not optimistic, Zhang added, noting that urban employment may continue to fall over the next year or two.

China’s aging population is another major reason for the decline. The working population aged 16 to 59 began to contract after peaking at 940 million in 2011. Their numbers sank by 6.6 million to 875.6 million at the end of last year from 2021, according to the NBS.

China should invest more in training the existing labor force and transition from relying on the demographic dividend to developing and relying on talents, said Yao Kai, director of the Funda University’s global research center for science and technology talent development.

China also needs to give full play to the elderly and provide training and employment support for those who wish to continue working, Yao said.

Editor: Dou Shicong, Futura Costaglione