The government has urged steel and coal companies to pay compensation to their laid-off employees and help them find new jobs, according to an announcement released on Thursday by the Ministry of Human Resources and Social Security.

China began in 2015 to cut overcapacity in the steel and coal industries, and close companies operating illegally to boost competitiveness in these industries. The measure is expected to affect the jobs of about 1.8 million people, Yin Weimin, minister of human resources and social security, said previously.

Companies that have been affected by the government's measures are encouraged to create new jobs for laid-off employees and to transfer unemployed workers to businesses in need of manpower, according to a notice jointly released by the ministries of finance, human resources and social security, industry and information technology as well as the National Development and Reform Commission, and the State-owned Assets Supervision and Administration Commission.

The notice requests companies facilitate laid-off workers' efforts to start their own business, saying employers should also provide training sessions for unemployed workers.

The central departments also ask local authorities to scrutinize companies' use of government subsidies to ensure that every laid-off employee receives compensation.

Premier Li Keqiang said in the Government Work Report delivered at the annual session of the National People's Congress earlier this month that the country's steel production capacity was cut by more than 65 million metric tons and coal by about 290 million tons in 2016.

The central government has allocated 100 billion yuan ($14.5 billion) to help steel and coal companies compensate laid-off workers or create new jobs, according to the Ministry of Human Resources and Social Security.

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