Abstract: With the rapid development of Internet and information technology,the main trend of modern industrial development is the integration of manufacturing and service industries,and the interaction between them in employment is crucial to enlarge the scale of employment in the New Normal.Based on the Chinese provincial-level panel dataset(except Tibet) during the period 1997-2016,this paper constructs a simultaneous equations model including both manufacturing employment equation and service employment equation,and examines the interaction of employment between them as well as influential effects that exogenous variables of economic system have.The empirical analysis indicates:Firstly,on the whole the multiplier effect of manufacturing employment on local service employment dominates the interaction of employment between manufacturing industry and service industry,while various service sectors have insignificant squeeze-out effects of employment on low-end manufacturing industry,which may be the main cause for service industry that fails to promote manufacturing employment.Secondly,low-end manufacturing industry has unidirectional multiplier effect of employment on both consumer services and producer services since low-end manufacturing industry is more sensitive to the variation of labor cost,but there exists significant bidirectional multiplier effect of employment between various service sectors and mid-high or high-tech manufacturing industry.Thirdly,enlarging market scale,promoting the rate of economic opening and increasing the manufacturing industry concentration are beneficial to increase manufacturing employment,while promoting informatization as well as service clusters contributes to improve performance in service employment.On the contrary,the increase of organic composition of capital and the prevalence of local protectionism may reduce the employment opportunities.Finally,complementary relations in the interaction of employment between manufacturing industry and service industry exist in different regions.Therefore,it's crucial to promote the deeply essential amalgamation of manufacturing and service industries,strengthen policy guidance and oversight and make full use of regional comparative advantages in the interaction of employment to maximize employment opportunities by regional industry transfer.

Key words: interaction of employment, manufacturing employment, service employment, simultaneous equations mode