Employment Effect Of Foreign Direct Investment On Hainan Province

Since 1978,China has implemented the policy of reform and opening up for more than 40 years.Absorbing foreign direct investment is one of the core contents of China’s opening-up policy.Foreign direct investment has made great contributions in many aspects of China,such as economic growth,technological progress,employment,export and institutional change.Initiated in late 2013,Xi Jinping,Chairman of the "area" initiative,is committed to strengthening optimization related to the coastal city of port construction,strengthening the function of international hub airport,in order to achieve a deeper,more perfect the reform of open economy system and mechanism,but it also provides the belt and Road provinces and cities with opportunities to participate in and lead the competitiveness of international economic and trade cooperation.Nowadays,foreign direct investment is regarded as one of the important powers in the development of real economy,and its influence on employment has attracted the attention and attention of scholars.As one of the five eastern provinces along the "Maritime Silk Road",Hainan is also a special economic zone and pilot free trade zone of China.However,Hainan’s economic development has been unable to compare with that of other key economic provinces in China,due to the influence of policy planning and historical evolution.The problem of economic repression caused by these factors has been well improved since the establishment of Hainan Free Trade Zone in 2018.But at present,compared with other developed provinces in China,Hainan’s employment rate is at the lower middle level.Employment is not only a hot issue of social concern,but also an important economic problem.Therefore,the effect of foreign direct investment on employment in Hainan province is an important economic research topic.This paper summarizes some theories and research results of domestic and foreign scholars on the relationship between foreign investment and employment.This paper analyzes the transmission mechanism of foreign capital’s effect on employment and the current situation of foreign direct investment,employment quantity and employment quality in Hainan Province,and finds that Hainan province has a large space for improvement in the lack of human resources,the introduction of foreign capital and the use of foreign capital to promote employment problems.Through the construction of VAR model,this paper analyzes the relationship between foreign direct investment and employment quantity and employment quality in Hainan Province,and finds that the increase of foreign direct investment has a crowding out effect on employment quantity in Hainan province in a short term,which reduces the employment quantity in Hainan Province.With the continuous accumulation of foreign direct investment,although the number of employment did not increase significantly in the early stage,it rebounded in the later stage,that is,Hainan needs to attract foreign investment for a long time to increase the number of employment.In addition,the inflow of foreign direct investment will effectively increase the employment quality of Hainan Province.Although the positive effect tends to be gentle gradually,on the whole,foreign investment can effectively promote the improvement of employment quality of Hainan Province,that is,foreign investment has a positive impact on the employment quality of Hainan Province.In the long run,foreign direct investment has a significant and positive impact on the quantity and quality of employment.This paper puts forward countermeasures and suggestions for foreign direct investment policies: Hainan province should keep up with current events,take advantage of the opportunities provided by the policies to attract more investment,gradually expand the scale and scope of investment and optimize the quality of investment,so as to improve the foreign investment environment and continuously enhance the development of regional economy.In order to expand the scale of foreign direct investment,priority should be given to improving the local investment environment in Hainan province,because foreign investment tends to choose regions with good development prospects.Strengthening innovative ways to attract foreign investment can effectively expand the scale of foreign direct investment and better expand its channels of investment,further strengthen the opening up to the outside world,enhance Hainan’s overseas investment attraction strength;Hainan province should pay attention to the high quality of human capital stock,due to the foreign capital enterprise usually has a more mature human resource management with higher technical level,the government can take advantage of this,more preferential policies to foreign companies,while foreign companies for secondary technical post technical training of local workers accordingly,so as to achieve win-win situation;The free trade port should make full and solid preparations for the next stage of promotion.It should open more high-quality projects to foreign enterprises and implement preferential policies for "advanced,sophisticated and shortage" talents,so as to accelerate the absorption of domestic and foreign capital and attract more domestic and foreign talents,so as to improve the quantity and quality of employment in Hainan province by leaps and leaps.