Industrial-finance cooperation policy and corporate employment: Evidence from China

Against the backdrop of sluggish global economic expansion, optimizing the financial service system is crucial for promoting industrial development and stabilizing the job market. This study treats the Industrial-finance cooperation policy (IFCP) as a quasi-natural experiment. We utilize the Differences-in-Differences approach to evaluate the effect of IFCP on firm-level employment. The results indicate that IFCP increases firm employment scale by 3.55%. Mechanism analysis reveals that IFCP expands employment through two channels: financial resource acquisition and business risk reduction. Heterogeneity analysis indicates stronger effects in lower financial development regions, technology-intensive industries, state-owned firms, and firms with strong external supervision. Furthermore, IFCP increases demand for technical and sales staff while reducing the need for administrative personnel. This research contributes novel perspectives on the nexus between financial policy and labor market dynamics, offering implications for both theoretical development and policy practice.