Abstract Using data from a unique survey conducted in five large Chinese cities that employed an internationally comparable definition of unemployment, we find that the unemployment rate of urban permanent residents was 14.0% in 2002. Comparing unemployment rate estimates across time and space using data from the 2001 China Urban Labor Survey (CULS) and China's 2000 population census, we estimate that for China as a whole, from January 1996 to September 2002, the unemployment rate of urban permanent residents increased from 6.1% to 11.1%, and that of all urban residents, including temporary residents (e.g., migrants), increased from 4.0% to 7.3%.