Previous studies have examined the effects of digital technology on employment, yet neglected the potential impact of integrating digital technology with government services on employment quality. To fill this gap, this study uses panel data at prefectural level and treats the 2014 "National Pilot Policy of Information Benefiting the People" as an exogenous shock to examine the impact of digital government construction on urban employment quality employing a difference-in- differences model. The results indicate that digital government construction significantly enhances urban employment quality. Mechanism analysis reveals that digital government construction improves employment quality by promoting government-led employment information transparency and fostering high-quality entrepreneurship. The heterogeneity analysis of urban environments shows that the positive effect of digital government construction on employment quality is more pronounced in cities with better- developed clean governance, business credit systems, innovation ecosystems, and market-oriented human resource services. Additionally, digital government construction mainly improves employment conditions, worker compensation, and social security levels. This study expands the research scope of the employment effects of digital economic development, and provides important policy insights for advancing digitally empowered public employment service models and strengthening mechanisms to promote high-quality and full employment.

BACKGROUND

Employment is a cornerstone of people’s livelihoods and a crucial indicator of socioeconomic development. Although China’s employment landscape has remained broadly stable, it continues to face structural challenges, as evidenced by the coexistence of job seekers encountering employment difficulties and employers experiencing recruitment shortages. Moreover, the overall quality of employment still falls short of the requirements associated with high-quality development. While existing literature has extensively examined how digital technologies promote self-employment and facilitate employment through market mechanisms, relatively little attention has been given to the potential impact of integrating digital technologies with public services, particularly within the framework of digital government, on employment quality.

OBJECTIVE

This study investigates the impact of digital government development on the quality of urban employment in China and explores the underlying mechanisms of this relationship. It also compares the effectiveness of digital government initiatives across cities with different institutional and market conditions and examines whether various dimensions of employment quality respond differently to digital government initiatives.

METHODS

Using panel data from Chinese prefecture-level cities between 2011 and 2019, this study constructs a multi-dimensional index to assess employment quality. The index encompasses five dimensions: employment capability, employment status, labor remuneration, social security, and labor relations. The entropy weighting method is employed to synthesize these dimensions into a comprehensive index. To identify causal effects, the study uses the 2014 launch of the "National Pilot Policy of Information Benefiting the People" as a quasi-natural experiment and applies a difference-in-differences (DID) model to estimate the impact of digital government development on urban employment quality.

RESULTS

The results show a statistically significant positive effect of the pilot policy on employment quality after controlling for city fixed effects, year fixed effects, and other city-specific characteristics. Economically, the implementation of the pilot program led to an average increase of 0.0155 units in the employment quality index for pilot cities compared to non-pilot ones, representing a 7.53% improvement relative to the mean. Mechanism analysis reveals that the policy significantly improved the transparency of employment-related public information and enhanced the quality of entrepreneurial activity. Heterogeneity analysis further shows that the policy had a significantly stronger impact in cities with higher levels of government integrity, commercial creditworthiness, innovation capacity, and market-oriented human resource services. Moreover, the policy had statistically significant effects on employment status, labor remuneration, and social security, while its impact on employment capability and labor relations was not statistically significant.

CONCLUSIONS

Digital government initiatives play a crucial role in improving urban employment quality by enhancing the transparency of public employment information and supporting the development of high-quality entrepreneurial activities. These initiatives have shown more substantial effects in cities with more favorable institutional and market environments, including lower levels of government corruption, stronger commercial credit systems, greater innovation capacity, and more market-oriented human resource services. This finding highlights the complementary relationship between digital government development and urban environmental conditions in promoting high-quality employment. Based on these insights, policy efforts should focus on further advancing government information disclosure and data transparency, strengthening support for innovation-driven and high-potential entrepreneurial ventures, and cultivating institutional and market environments that facilitate efficient labor allocation and sustainable employment growth.

CONTRIBUTION

First, this study examines employment quality from the perspective of government-facilitated employment, investigating how the integration of digital technologies with public services contributes to its improvement. This approach expands the analytical scope of existing research on the digital economy's impact on employment outcomes. Second, by incorporating government transparency in employment information and the development of high-quality entrepreneurship into the analytical framework, the study explores the mechanisms through which digital government initiatives influence employment quality, thereby enriching the literature on the economic effects of digital governance. Third, the study reveals a complementary relationship between urban environmental improvement and digital government development in enhancing employment quality, highlighting the critical role of aligning an enabling government with an effective market in promoting high-quality employment.