A Study Of China’s De-industrialization And Its Impacts On Economic Growth

Because of Global Financial Crisis & European Debt Crisis caused by United States subprime mortgage crisis in 2008, the economy of many countries(especially the developed countries) was hit hard and economic indicators declined. Many scholars attributed the outbreak of the crisis to de-industrialization of developed countries. They think de-industrialization weakened the development of the real economy severely, sowe should recognize the value of the manufacturing industry, and goback to the real economy. As a result, more and more countries are seeking for re-industrialization. However, did the de-industrialization really hinder the development of economy? Would all de-industrialization cause problems like industrial hollowing out and huge unemployment? How’s the relationship between de-industrialization and economic growth? We think All these problems are linked with the de-industrialization.Throughout the world economic development, we know industrialization is the foundation of a country to modernize. After the industrial revolution, many countries started into the industrialization process, with rapid economic growth and significant improvement of living standards. However, with the end of industrialization process of developed countries, many countries began devoting a lot of manpower and material resources to service sectors, while the industry sector’s indicators continued to decline, then de-industrialization phenomenon appeared. Through a variety of related world economic data analysis, we think all developed countries and high-income countries have already experienced or are in the process of industrialization. De-industrialization is the inevitable process of economic development. China will also inevitably experience de-industrialization. So far there are lots of studies focusing on developed countries’ de- industrialization and the impact of re-industrialization on our country’s economic development. But there is almost few analysis for China’s de-industrialization problem. Due to the necessity of industrialization, de-industrialization is no longer the only economic phenomenan of developed countries; developing countries will also face the problem during their develop process. So it’s meaningful to study Chinese de-industrialization.This paper discusses the problem of how de-industrialization influence economic growth through introduction of a theoretical model, in which the performance of de-industrialization is decreasing manufacturing employment proportion, thereby affecting the manufacturing productivity growth rate, thus affecting the overall economic growth rate. However, due to manufacturing productivity and service productivity are different in various countries or regions, the ability to adsorb the transfer employment are different, and industry characteristics are diffirent, so the effect to economic growth is different. In one word, the influence of de-industrialization on economic growth is not linear.Through the analysis of China’s relevant economic data, we think our country has not yet entered the comprehensive de-industrialization process, and no integrative amounts’ de-industrialization appear. Because of China’s vast territory, it’s very necessary for further exploration of de-industrialization problems between regions in China.According to the relevant manufacturing data of all provinces(or regions),we can see manufacturing employment & output proportion are showing a sign of decline in some provinces(or regions),then regional de-industrialization appear. It matches with the characteristics of the unbalanced regional economic development in China.In addition, with the development of economic globalization and the establishment of a new international division of labor system, development trend of the world economy is gradually characterized by the integration of resources on a global scale. So we put forward some targeted suggestions for Chinese industry(especially manufacturing) development after combining the development trend of world economy with the development of China’s own industry characteristics. First, under the background of developed countries’ de-industrialization and re-industrialization, China should undertake the industry transfer from developed countries’ de- industrialization scientifically and effectively. In the same time, we should pay more attention to learning advanced technology & management experience and improving innovation so that we can successfully deal with the challenges of developed countries’ re-industrialization. For Chinese de-industrialization, we should adhere to structural de-industrialization and try to avoid the negative impact of integrative amounts’ de- industrialization. In the aspect of industrial structure adjustment, we should pay attention to the differences of regional development; be forward-looking; put some high-tech industries in the regions where have the development potential; avoid same type of development pattern which is low efficiency; take a new road to industrialization in the context of the new era. Only in this way can China avoid the negative impact of industrialization in the process of industrial development; adjust industrial structure and transfer industrial positively and effectively; maintain long-term and stable economic development.