Enterprise the latest buzzword as Chinese iron rice bowl has to go

Yi Xiaorong, 51, was retrenched after having worked at a Wuhan Iron & Steel subsidiary since the eighties.

After various setbacks, she now earns Yuan 30,000 ($4,600) a month as a confinement nanny, and is being held up as a shining example of how one can re-emerge successful when armed with a never-say-die attitude.

Yi's skills in providing specialist postnatal care to new mothers and their newborns in their first 30 days as part of a Chinese tradition now see her in high demand. She's even gone global. In June, she's set for a two-month assignment in Hungary, followed by the US, where her clients are based -- all expenses paid -- according to a recent post on the steelmaker's official WeChat account.

That Yi's departure from the steel company took place years ago and not recently was probably less important to Wuhan Steel than what it hopes to achieve with her story: Lift the spirits of the thousands of workers that may soon be shown the door and nudge them into venturing for jobs outside, as Beijing brings its supply-side structural reforms to bear.

The Hubei-based mill, one of the few controlled directly by the central government, has probably been the most plain and transparent in telling its employees that the iron rice bowl -- a Chinese expression for a job one can keep for life -- will have to go. About 500,000 steel workers may be "reassigned" over the next five years as capacity gets cut 100-150 million mt, according to government estimates.

Wuhan Steel isn't the only one, as other state-owned mills like Tianjin Pipe Group Corp, that tend to have heavier employee social security burdens than their private counterparts, have also been encouraging workers to consider alternative livelihoods in entrepreneurship.

The messaging has been consistent across Beijing: The central bank pledged last month greater financial backing for those leaving the steel and coal industries to set it out on their own but lack capital.

Banks would also tailor their services to meet the needs of small and micro enterprises.

In conversation with people in the industry, it is not uncommon to hear of the coal tycoon whose wealth has been decimated by the plunge in prices, but who lacks ideas as to which gravy train might next deserve an injection of their funds.

But it is perhaps not the coal or steel boss that the state is thinking about when it formulates and coordinates its policies.

It will be the displaced rank-and-file worker that they're seeking to support, with hope that some might eventually find themselves out of the woods and follow in Yi's footsteps.

Yi, incidentally, has taken on a few apprentices in her free time who earn "upwards of Yuan 8,000" a month (average income in Wuhan is Yuan 5,800).

This editorial was first published in the May 4 edition of World Steel Review.