Research from HSBC has claimed the economic downturn may drive over 20m migrant workers out of work.

However, it pointed out that this would not be the most sizeable loss in recent history, as when the state-owned enterprises (SOEs) were being restructured between 1996 and 2000 nearly 50m workers were laid off.

A key difference this time may be that the Government has much deeper pockets to help the unemployed. The stimulus package includes 13%-15% increases in grain purchase prices and 13% subsidies on electronic appliance purchases, which HSBC claimed should lift farmers' income by 3-4% and help stimulate rural consumption.

However, the bulk of the RMB4 trillion stimulus package is focused on infrastructure and public housing projects, which could create new jobs with immediate effect. For instance, the Ministry of Railway estimates that new railway projects will create about 3 million jobs a year, and other transportation infrastructure projects are likely to generate around 3 million new jobs per year.

Together with construction projects, HSBC said: "...the stimulus package should generate 7.5 million jobs in 2009, effectively absorbing nearly 40% of rural migrant workers who have lost their jobs. "