Hukou Reform at the Third Plenum: Its Implications On Rural Migrant Workers
By Ashley Park
China’s emergence as the “world’s factory” has been underpinned by an extraordinary
mobilisation of rural labour. Since the market-oriented reforms initiated in the late 1970s, the Chinese Communist Party has increasingly combined state-directed development with market mechanisms and global capital. Yet this economic transformation has produced a fundamental contradiction: while China’s industrial growth depends on the mobility of its workforce, the state has historically restricted migrants’ access to the social protections associated with urban life. The hukou system lies at the centre of this contradiction. Recent reforms signal a potential shift towards greater social inclusion, but can administrative reform dismantle the inequalities upon
which China’s development model has long relied?
Introduced in the 1950s, China’s hukou, or household registration system, classifies citizens according to their registered household and, historically, their rural or urban status. It initially served to regulate migration, manage urbanisation and allocate resources within a centrally planned economy. By limiting unrestricted movement into cities, the system sought to prevent urban overcrowding while preserving rural households’ access to collectively owned land. However, as China liberalised its economy and expanded its manufacturing sector, the hukou system acquired a new function. Millions of rural residents migrated to industrial centres to
supply the labour required by export-oriented growth, often without obtaining local urban registration. Although these workers contributed to urban prosperity, their access to public education, housing assistance, healthcare and social security remained restricted or conditional.
The result is a two-tier urban society: people may live and work in the same city while enjoying markedly different entitlements. This institutional separation has consequences beyond individual welfare. Migrant families may be compelled to leave children with relatives in their home villages, while workers themselves face greater insecurity in the event of illness, unemployment or retirement. The system therefore illustrates how administrative classifications can reproduce social inequality even as economic boundaries become more permeable. These contradictions are particularly visible in the experiences of dagongmei, a term commonly
used to describe young rural women who migrate to cities for industrial and service-sector employment. Emerging prominently alongside China’s manufacturing expansion during the 1990s and 2000s, the term reflects more than a demographic category: it captures a distinct position within China’s changing class structure.
For many first-generation dagongmei, factory employment offered an opportunity to earn wages unavailable in rural communities. Yet their economic independence often came at the cost of long working hours, employer-controlled accommodation and separation from their families. Remittances supported households in their places of origin, while the workers themselves remained marginal to the social institutions of the cities they helped sustain. Their position also reveals the gendered dimensions of labour exploitation. Women’s employment in labour-intensive industries has historically depended on their availability as a relatively inexpensive and flexible workforce. Their contributions to economic development have not necessarily translated into equivalent social recognition or security. The label dagongmei consequently embodies a tension between empowerment through paid employment and subordination within intersecting hierarchies of class, gender and household registration.
Nevertheless, the experience of migrant workers is not static. Younger generations, generally better educated and more aware of their rights, increasingly aspire to stable employment, family life and access to urban public services. They are less willing to regard prolonged insecurity as an inevitable price of upward mobility. Their expectations raise a pressing question: can China’s institutional framework adapt to a workforce whose aspirations increasingly exceed the conditions offered by its traditional model of migration?
Reform, since the 1990s, has been gradual. China expanded rural healthcare and pension provision during the 2000s, while the Social Insurance Law of 2010 established a broader framework for social insurance. More recently, the Third Plenum of July 2024 renewed commitments to reform household registration and improve access to basic public services. The Third Plenum was said to be put into action in April 2026.
A significant development followed in May 2026, when the State Council issued guidelines promoting the provision of basic public services according to permanent residence rather than local hukou. The measures seek to expand migrant children’s access to education, widen eligibility for public rental housing and remove household-registration restrictions on participation in employee social insurance. They also encourage improved access to healthcare and employment services.
These changes are significant not only for their social implications but also for their economic rationale. First, expanding social protection may encourage domestic consumption. Migrants who lack reliable access to healthcare, pensions or unemployment protection have strong incentives to save against future risks rather than spend their earnings. Reducing this insecurity could release household spending and support China’s efforts to rebalance growth towards domestic demand.
Second, reform addresses demographic pressures. As China confronts an ageing population and persistently low birth rates, reducing the financial and administrative barriers facing young families could improve access to education, healthcare and childcare. Extending services to migrant children may also strengthen the country’s future human capital. Finally, reform supports the creation of a more integrated national labour market. When access to public services depends on registration rather than residence, workers face additional barriers to settling where employment opportunities are greatest. Reducing these barriers could improve labour mobility and allocate talent more efficiently across regions.
Despite these developments, reform should not be mistaken for the immediate abolition of inequality. The new guidelines establish a direction for policy, but their effectiveness depends on implementation by local governments, the availability of public resources and the practical eligibility conditions attached to services. Cities experiencing substantial population inflows must expand schools, housing and healthcare provision, while migrants may continue to encounter disparities in employment conditions and access to opportunities. Moreover, extending welfare eligibility does not automatically resolve the unequal power relations within workplaces. Greater access to social insurance cannot, by itself, guarantee fair
wages, reasonable working hours or effective protection against labour exploitation. Nor does it eliminate the gendered expectations that shape women’s employment and family responsibilities.
Ultimately, Hukou reform represents an important attempt to reconcile China’s economic development with the social needs of the population sustaining it. For dagongmei, the possibility of accessing public services where they live and work could mark a meaningful departure from a system that has long treated their labour as essential while limiting their claims to urban citizenship.
Whether this becomes a lasting transformation depends on more than administrative change. It requires translating formal entitlements into substantive equality. The future of dagongmei will therefore be determined not simply by whether they can register in the cities they inhabit, but by whether those cities recognise them as equal participants in the social and economic life they help create.
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