Research on Employment Effect of FDI in Service Industry in Jiangsu Province

Abstract

In recent years, the global foreign direct investment (FDI) has shown a “service-oriented” trend, and the labor force has gradually begun to flow to the service industry. Introducing FDI into service industry can not only absorb part of employment with its job-creation effect, but also promote the improvement of employment quality. Under the guidance of market demand and the government, the proportion of FDI in China's service sector has gradually increased, and the service sector and service trade have become a new driving force for China's economic growth. The development of service industry in Jiangsu province has always been in a leading position in China. Meanwhile, Jiangsu province is also one of the main provinces where labor force gathers. Therefore, it is of theoretical and practical significance to study the employment effect of FDI in service industry in Jiangsu Province for relieving employment pressure and promoting the efficient use of FDI. This study firstly combs the relevant literature at home and abroad, which is divided into two aspects of employment quantity and employment quality. On this basis, the paper analyzes the mechanism of service FDI's influence on employment from these two levels and constructs the theoretical basis of this study. Secondly, this study analyzes the current situation of FDI and employment in service industry in Jiangsu Province. Then, empirical analysis is made on the data of Jiangsu province from 2007 to 2020, and the conclusion is drawn that FDI in service industry in Jiangsu Province can not only promote the increase of employment quantity in service industry, but also promote the improvement of employment quality in service industry. Based on the above analysis, this study puts forward relevant suggestions on how to make more efficient use of FDI to drive employment effect in Jiangsu province.