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China will continue to face serious employment challenges this year and is likely to create less than half the jobs needed to cope with armies of new jobseekers and laid off workers.

According to the National Development and Reform Commission (NDRC), urban areas need to create around 25 million jobs to accommodate newcomers in the labor market, those who have lost their jobs in state firms, and job hunters from the rural areas.

But the commission said the country would only be able to create an estimated 11 million jobs.

"The level of surplus labor this year will reach 14 million, around one million more than last year," it said in a report prepared jointly with other ministries.

According to the report, increased pressure on the employment situation is a result of streamlining by companies and trade frictions.

China created some 9.7 million jobs in 2005, maintaining a registered urban unemployment rate of 4.2 percent.

Tens of millions of workers have been laid off from bankrupt or restructuring state enterprises in recent years. Although the commission gave no prediction for the country's jobless rate this year, it said that around 6.6 million people faced possible job losses over the coming three years.

The nation's new labor force is likely to hit 17 million in 2006, it said, adding that around 60 percent of which would come from the rural areas.

(Xinhua News Agency February 14, 2006)