On the 22nd of May, China announced a reform to the hukou system, meaning that its 357 million migrant workers will now be able to register for social insurance programs wherever they work. The system had previously registered each citizen with their place of birth and tied their access to social programs, such as healthcare, public education, and social housing to that specific area
It is impossible to understand the hukou system without understanding what it prevented. When Reform and Opening Up began in the late 1970s, 83 percent of China’s population lived in the countryside. Over the following four decades, more than 600 million people moved from rural areas to the cities, such that the urbanisation rate has now hit 68 percent.
In almost every other developing country, migration on this scale has produced vast slums: the hypercities of the Global South – Mumbai, Nairobi, Lagos, São Paulo, Dhaka, Cairo, Mexico City – are ringed by sprawling informal settlements, and across the Global South slum growth has consistently outpaced urbanisation since the 1970s.
China has managed to avoid this. Walk through Shanghai or Beijing – each with over 20 million inhabitants – and the pervasive slums and homelessness common to comparably-sized cities elsewhere are conspicuously absent. The hukou system was central to this achievement: by regulating the pace and direction of migration, it prevented a chaotic flood into a handful of megacities whose services and housing could not have coped.
While China's been progressively removing hukou limits for smaller cities of under 3 million residents for years, this is now a nationwide initiative
The contrast with the trajectory of the Western capitalism is stark. While China is moving to extend social insurance to – and improve pay and conditions for – its couriers, drivers and other platform workers, the dominant trend in the West runs in precisely the opposite direction.
In Britain and the US, the gig-economy giants have waged a sustained legal and political campaign to deny their workers the status of employees altogether – the better to avoid paying for sick leave, pensions, holiday pay or even the minimum wage.
Uber fought all the way to the UK Supreme Court in 2021 in an unsuccessful attempt to classify its drivers as self-employed; Deliveroo riders were denied collective bargaining rights by the same court in 2023; and in California, the gig companies spent over $200 million on a 2020 ballot measure, Proposition 22 – the most expensive in the state’s history – specifically to exempt themselves from treating their drivers as employees.
Where the logic of a socialist system, even amid the complexities of a vast developing economy, pushes over time towards the extension of social protection to all working people, the logic of capital pushes relentlessly in the other direction: towards the erosion of those protections in the name of profit.
The steady dismantling of hukou barriers is, in the final analysis, a reflection of a system oriented towards human welfare rather than private accumulation.
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