China’s Hukou System: Residence Permits, Schools, and Reform

China’s hukou system is the country’s household registration program, and it assigns every citizen a legal home location and a status type that together control where they can access public schools, healthcare, pensions, and permanent settlement rights. Established by the 1958 Regulations on Household Registration, it remains one of the most powerful administrative tools the Chinese government uses to manage a population of more than 1.4 billion people, and it shapes daily life for anyone who lives somewhere other than where they are registered.

How the Registration Works

Every Chinese citizen receives a hukou at birth. It has two parts: a location tied to a specific city, town, or village, and a status type that has historically been either agricultural or non-agricultural, roughly corresponding to rural or urban. Both parts are hereditary. A child born to parents with rural agricultural registration inherits that same classification, no matter where the birth actually occurs.¹

The physical record is a household registration booklet, called a hukou bu in Chinese, kept and administered by local public security bureaus and police stations. The booklet lists a person’s legal address, family members, employment affiliation, and other personal information, and it is a prerequisite for enrolling a child in school, getting married, and handling other routine legal transactions.¹

Local Versus Non-Local Residents

The registration also sorts people into local and non-local residents. A local resident’s hukou matches where they physically live. A non-local resident lives somewhere other than where they are registered. This is the distinction that produces most of the system’s practical bite, because public services in China are funded and managed at the local municipal level, and access flows through the local registration rather than through where someone actually lives and works. A factory worker who has spent twenty years in Shenzhen but holds a rural hukou in Hunan is, in administrative terms, still a non-local resident of Shenzhen.

Healthcare, Pensions, and Social Insurance

China’s basic medical insurance programs are organized regionally. Workers with local urban hukou are enrolled in the Urban Employee Basic Medical Insurance system through their employers. Migrants without local registration have historically struggled to enroll at their place of work, and many have paid out of pocket at significantly higher rates than insured residents. The State Council began integrating the separate urban and rural medical insurance systems into a unified program in 2016, but coverage still depends heavily on where a person is registered.²

Retirement pensions follow the same localized pattern. Contributions made in one city can be difficult to transfer if a worker moves, and some workers reach retirement only to find they must return to their registered home region to collect benefits. In June 2025, central authorities issued guidelines calling for the full removal of hukou-based restrictions on enrolling in social insurance at the place of employment, a move meant to make benefits portable for the country’s mobile workforce.³

Schools and the Gaokao

For migrant families, education is often where the hukou system causes the most damage. Public school enrollment for children is tied to the parents’ registered location. A family living in Beijing with a rural hukou from Anhui province typically cannot enroll their child in a Beijing public school on the same terms as local families. When migrant children have gained access, families have historically been charged extra fees under labels such as “transient student fees,” “school selection fees,” or “endorsement fees.” National regulations have repeatedly tried to ban these surcharges, but they persist under different names.

The heaviest restriction is the gaokao, China’s national college entrance examination. Students are generally required to take the exam in the location of their hukou registration, not where they actually live. A student who grew up in Shanghai but holds a hukou in a rural province must return to that province to sit for it. Because universities in major cities accept lower test scores from locally registered applicants, a student forced to test in a rural province faces a harder path into top-tier schools. Some cities have begun allowing migrant children to take the gaokao locally, but Beijing and Shanghai have been slow to adopt this change.

The Floating Population and Residence Permits

The gap between where people are registered and where they live has produced one of the largest internal migrations in human history. Hundreds of millions of Chinese citizens live and work in cities while their hukou remains registered in distant rural villages. This group is known as the floating population, and the workers among them are often called mingong, or migrant workers. They build the skyscrapers, staff the factories, and run the delivery services that power China’s urban economy, while their city of residence treats them, administratively, as outsiders.

The 1958 regulations require anyone staying away from their registered home for more than three days to report to local authorities.¹ To live long-term in another city, migrants must obtain a residence permit by submitting employment documentation, proof of housing, and identification to the local public security bureau. Without valid documentation, a person can be barred from purchasing property, registering a vehicle, or accessing government services. A national residence permit system introduced in 2016 gave migrants access to some basic services in their city of residence, but the permit falls well short of full local hukou status.

Buying Property in Another City

In many major Chinese cities, hukou status has determined whether a person can buy residential property at all. Non-local residents have typically faced requirements such as several years of continuous local social security contributions before becoming eligible, and some cities have limited the number of properties a non-local buyer could purchase. These rules operate as a second layer of population control on top of the hukou itself.

The picture has shifted as China’s property market has cooled. By mid-2024, more than 50 cities had eased or eliminated hukou-related homebuying restrictions to stimulate demand, with cities including Hangzhou and Xi’an dropping requirements for local hukou or local social security accounts and lifting caps on the number of properties a buyer could purchase. Whether these relaxations hold when the market recovers is an open question.

How to Change Your Hukou

Permanently changing hukou registration is possible, but the difficulty varies dramatically by destination. A 2014 State Council opinion set out a tiered structure based on city size.⁴

Small cities and towns have largely eliminated restrictions. Anyone with a stable residence, including a rental, can generally apply for local registration along with their spouse, minor children, and parents.⁴
Medium cities of 500,000 to 1 million people require stable employment, stable housing, and participation in urban social insurance for no more than three years.⁴
Large cities of 1 to 3 million people apply stricter conditions, including longer stable employment and social insurance requirements not to exceed five years.⁴
Mega-cities of 3 to 5 million and above can impose the most restrictive conditions and are encouraged to use points-based settlement systems to control the pace of new registrations.⁴

The points systems in Beijing and Shanghai are where the barriers become formidable. Common scoring criteria include educational attainment, professional certifications, years of local social security contributions, tax payments, and employment in priority sectors like technology. Shanghai requires at least seven years of continuous social security contributions. Beijing operates an annual quota of roughly 6,000 successful applicants, meaning the vast majority who apply are turned away. Applicants must also have clean criminal records.² Converting a rural hukou to urban registration in a top-tier city is something most migrant workers will never achieve.

Where Reform Stands

Reform has proceeded in fits and starts. The 2014 State Council opinion called for eliminating the agricultural and non-agricultural distinction entirely, unifying them into a single “resident household registration.” Several provinces have made this change on paper, though practical differences between rural and urban registration persist in how services are delivered.⁴

More recent efforts have focused on decoupling public services from registration status rather than making registration itself easier to change. The June 2025 social insurance guidelines directed that workers should be able to join pension and medical insurance programs wherever they work, regardless of where their hukou is registered.³ In May 2026, the State Council issued additional guidelines calling for broader decoupling of basic public services from household registration, including access to public preschool and high school education for migrant workers’ children and expanded public rental housing for non-local families with stable employment.

The pattern is consistent. The central government issues aspirational guidelines, and local governments implement them at their own pace. Smaller cities with shrinking populations actively recruit new residents by loosening requirements. Mega-cities like Beijing and Shanghai, facing heavy demand, move slowly and protect their existing barriers. The system is gradually becoming less rigid at the edges while remaining deeply entrenched where it matters most.

1
Congressional-Executive Commission on China. China’s Household Registration (Hukou) System: Discrimination and Reform
2
EveryCRSReport.com. China’s Hukou System: Overview, Reform, and Economic Implications
3
Friedrich-Ebert-Stiftung. China Removes Hukou Barriers to Enrolling in Social Insurance Where People Work
4
China Law Translate. Opinion on Further Promoting the Reform of the Household Registration System