Report: Layoffs may loom next year

China's "invisible unemployment" will become more visible next year, a top Chinese think tank's report warned, as it urged the government to allow more unviable State-owned enterprises to go under.

Invisible unemployment has been the topic of heated discussion recently. In contrast to outright layoffs, invisible unemployment is the practice by which profit-losing State-owned enterprises adopt a strategy of idling employees while giving them part of their wages. They do so due to pressure from employees as well as from authorities to prevent social unrest.

However, the annual economic forecast from the Chinese Academy of Social Sciences predicts that because of the glut of capacity in the heavy industry sector, more SOEs in the sector will "inevitably" face restructuring and bankruptcy next year, and lay-offs will increase.