Research On The Impact Of Social Insurance Payment Burden On Labor Employment

In recent years,“stabilizing employment” and “reducing taxes and fees” are the top priorities to ensure people’s livelihood and stimulate the vitality of enterprises.With the impact of Sino-US trade war,population pressure,economic downturn and the COVID-19,the already severe employment situation has worsened.Employment is related to people’s livelihood.Ensuring people’s full employment and high-quality employment has always been the focus of our government’s work.Stable employment is conducive to people’s stable life,social stability and order,and sustainable economic development.As the main body with the largest demand in the labor market,enterprises have always been the key objects for the government departments to implement the “stable employment” policy and maintain the stable operation of social economy.In the deteriorating external environment,only by reducing the operating costs and financial pressure for enterprises can enterprises achieve sustainable development,thereby creating greater employment space for society and achieving more full and high-quality employment.Among many operating costs of enterprises,the heavy burden of social insurance payment has been a topic of discussion in recent years.From the perspective of nominal contribution rate of social insurance,the contribution rate shared by enterprises and individuals in China is as high as 40%,which is at the forefront of the world.In order to solve the problem of high level of social insurance contribution rate in China,China has introduced many measures to reduce the social insurance contribution rate to stimulate the vitality of small and medium-sized enterprises and promote sustainable economic development.As the core subject of absorbing employment and social insurance contributions,enterprises play an important role in the current stage of government departments’ continuous emphasis on “stabilizing employment”and actively promoting “tax reduction and fee reduction”.Taking enterprises as the research object,discussing the impact of social insurance payment burden on labor employment will help to reasonably explain and predict the economic behavior of micro-market subjects under the change of China’s social insurance system,balance the relationship between social security and enterprise development,and then provide theoretical and practical support for the system design of social insurance premiums.In order to test the relationship between the social insurance payment burden and the employment growth rate of enterprises,and provide empirical evidence of the internal logic of the policy of “tax reduction and fee reduction” from the micro-enterprise level,this paper takes the data of listed companies in Shanghai and Shenzhen A-shares from 2007 to 2019 as a sample for empirical research.The results show that the social insurance payment burden has significantly reduced the employment growth rate of enterprises’ labor force,and the decline of the employment growth rate of enterprises’ labor force under the social insurance payment burden is a long-term behavior taken by enterprises to cope with the social insurance pressure,rather than a short-term strategy.The mechanism test shows that the fixed assets investment and capital intensity of enterprises have not changed significantly,while the free cash flow level and cash holding level of enterprises have decreased significantly,which confirms that the social insurance payment burden mainly causes the decline of labor employment growth rate through “cash flow effect” rather than “factor substitution effect”.This also shows from the side that when the state implements the “tax reduction and fee reduction” policy to reduce the burden on enterprises,it can not only help the society to stabilize employment,but also do not worry about the resulting decline in investment.In addition,the heterogeneity analysis shows that the negative correlation between the social insurance payment burden and the employment growth rate of enterprises is more significant among enterprises in areas with higher tax collection and management intensity,enterprises with weaker tax avoidance tendency,enterprises with stronger financing constraints and enterprises with higher labor intensity.On the basis of the above research conclusions,this paper suggests that the government departments continue to promote the policy of “tax reduction and fee reduction”,and can formulate different social insurance rates according to the economic situation;Perfect the enterprise financing environment and expand the enterprise financing channels;Social insurance funds should expand investment channels,improve the operation efficiency of funds and increase the income of fund accounts;Enterprises should maintain a long-term perspective,focus on long-term value rather than short-term benefits in the process of enterprise development,and establish a long-term mechanism and focus on long-term value.