The issue of jobs will be given top priority in Premier Zhu Rongji's government work report to be delivered to the National People's Congress in early March, an official source said yesterday.

Zhu is expected to highlight a whole series of new incentives to create jobs and improve the existing social security system, the source, who declined to be named, told China Daily.

China is facing soaring unemployment as a result of increasing lay-offs from State-owned enterprises, increasing numbers of university graduates, and a rising tide of rural youths yearning for non-farming jobs.

Concerned with the growing jobless rate, some experts have been calling on the central government to lay greater stress on employment rather than on economic growth.

"Full employment should be given top priority ... and GDP (gross domestic product) growth rate should not be regarded as the ultimate end," said Tang Min, principal economist with the Beijing-based PRC Resident Mission of the Asian Development Bank.

He warned that mass unemployment will pose the biggest threat to China in the next five to 10 years and failure to deal with it will drag down the country's economic growth rate.

He has been calling for a long-term "employment first" strategy, to replace the government's current "growth first" strategy.

But the government source revealed that, after some "careful and cautious study," the writing team for Premier Zhu's government work report decided not to use the phrase "employment first" as it "tends to create misunderstanding" about how to balance economic growth and employment.

"More importantly, employment itself is more of a macro-economic issue than a purely independent one. Its solution depends also on economic growth," he explained.

Any problems, including unemployment, cannot be effectively dealt with without relatively rapid economic growth, he said. Statistics suggest that each one percentage point of GDP growth can generate 1 to 1.2 million jobs in China.

An employment-oriented strategy will be embedded in the 2003 government work report to ensure the employment rate will rise along with economic growth, he noted.

New measures will include boosting labour-intensive industries and lending more support to small and medium-sized enterprises to generate more job opportunities.

Meanwhile, more government funds will be earmarked to provide training to jobless people.

The measures to be proposed in Premier Zhu's report show the government has come to realize the equal - if not greater - importance of employment, as compared with economic growth, said Mo Rong, deputy director of the Ministry of Labour and Social Security Institute for Labour Studies.

Faster economic growth will not automatically increase job opportunities unless some pro-active policies are put in place, the researcher said.

China is facing an uphill battle to cap its unemployment rate at 4.5 per cent in 2003. The official urban unemployment rate was 4 per cent already last year, excluding millions of laid-off workers kept on payrolls at token salaries and the more massive number of rural jobless.