How Digital Skills Affect Rural Labor Employment Choices? Evidence from Rural China

Abstract

Expanding employment channels for rural households is a crucial means of enhancing the income of rural residents and enhancing the quality of rural employment. This study examines the impact of digital skills on rural laborers’ employment choices and explores the underlying mechanisms by using data from the China Family Panel Studies (CFPS) spanning 2014–2018. By employing various models, including the Probit, IV, mediated effects, and propensity-score-matching methods, the study reveals that digital skills have a significant impact on rural laborers’ employment choices. Specifically, digital skills increase rural labor’s employment opportunities in nonfarm and employed employment while reducing the proportion of informal employment. Additionally, the analysis indicates that the main channels through which digital skills influence rural labor’s employment choices are human and social capital. A heterogeneity analysis further reveals that work-study and social-entertainment skills have a more significant effect on rural laborers’ nonfarm and employed employment opportunities while inhibiting informal employment. Hence, to enhance the quality of future rural employment, the government must encourage rural workers to enhance their digital literacy and digital application skills while improving digital infrastructure.