BEIJING - College graduates may soon have the chance to change their permanent residence permits to any place they work except four municipalities - Beijing, Shanghai, Tianjin and Chongqing.
"All cities except municipalities should remove restrictions of hukou settlement for college graduates and should permit their settlement where they work or where they start their own businesses," said a recent announcement by the State Council.
The move aims to help boost graduates' employment.
A hukou is closely tied to benefits like access to affordable housing and local public schools.
After graduation, college students' hukou revert to where they are from, unless they get settlement permits from the local government.
A total of 6.6 million students will graduate from college this year, 300,000 more than last year.
Jin Bei from Shandong province, who is now a postgraduate student at Wuhan University in Hubei province, welcomes the move.
Jin will graduate in June and she plans to seek a job in Guangzhou or Shenzhen, both in Guangdong province.
"It's good news to me because we can have more options when choosing places to work. To acquire a local hukou where I work will make me feel at ease and maybe I will stay there forever," she said.
A hukou in Beijing or Shanghai is the most desirable for college graduates but is harder to get. In Beijing, a person without a hukou is not allowed to buy a house or register a car unless he or she pays income tax in Beijing for five consecutive years.
But some cities have already mapped out favorable hukou policies for college graduates.
In the manufacturing hub of Shenzhen, the local government has allowed graduates from 133 universities in the country to apply for a local hukou if they work in the city.
Wang Liyan from Heilongjiang province, now a student at Beijing-based China University of Political Science and Law, said she plans to work in a local law firm but that the firm could not grant her a Beijing hukou.
"Without a Beijing hukou, I have to register in another place and I can't even join the lawyers' association in Beijing," she said.
Chen Yu, director of the China Institute for Occupation Research at Peking University, said the State Council's new policy will help free up talent flow in the country.
"Beijing and Shanghai's populations are too large and I think it's the central government's plan to encourage some graduates to go to second- and third-tier cities," he said.
When other cities' public service facilities and economic development catch up with Beijing and Shanghai there will be no restrictions for hukou settlement for college graduates in all cities, said Chen.
Shi Yingying contributed to this story.