China can take a leaf from post-war America on work-relief programmes

To combat the economic devastation of the Great Depression, US president Franklin D. Roosevelt deployed work-relief programmes – providing government-funded jobs for the unemployed – on a massive scale to stimulate demand and restore household confidence. Nearly a century after America’s New Deal, China is quietly integrating a similar concept into its latest push for consumption-led growth.

In mid-March, Beijing unveiled an ambitious “special action plan” to bolster domestic spending. The document zeroes in on a critical lever of economic recovery – raising household incomes to drive demand – and makes a direct reference to work-relief programmes. Their potential to shore up consumer confidence deserves a closer look.

Work-for-relief has long been deployed in rural China, though it rarely makes headlines. Historically, after natural disasters, officials mobilised farmers to repair roads or construct water systems, combining immediate relief for households with lasting social benefits. In post-Mao China, work-relief programmes were adopted by Beijing as a key strategy for poverty reduction.

Official data shows that between 1984 and 2020, over 160 billion yuan (US$22.05 billion) was invested in rural work-relief projects, generating millions of employment opportunities. These projects were instrumental in eliminating extreme poverty, a milestone delivered in 2021.

But China’s challenges today extend beyond its countryside. Traditionally, work-relief programmes have targeted rural employment, but now it is China’s 300 million migrant workers – those who have left their villages in search of higher-paying jobs – who warrant attention.

For two decades, real estate and infrastructure fuelled China’s growth, providing steady employment for migrant workers. Since 2020, a property downturn and a slowdown in new construction have left millions without a stable income.