Abstract: With the transition from planned economy to a market economy, published or official employment and unemployment data has become inconsistent with the reality of the Chinese labor market. The report analyzes and explains this phenomenon by a literature study, a historical review, in-depth interviews, as well as calculations and construction of econometric models. As the report points out, the country should assign importance to strategic measurement of the labor market, especially the employment and unemployment measurement systems. After ten years of exploration and research, the Chinese labor force survey system has developed a great deal. However, compared with the requirements of macro-economy research, the Chinese employment and unemployment measurement systems still need further improvement. The report systematically discusses Chinese employment and unemployment measurement system from theoretical analysis, historical review, systematic design, and empirical study. The report presents important theoretical viewpoints on employment and unemployment, and puts forward the framework and design for Chinese employment and unemployment systems in the future. This includes multiple dimensions, such as the establishment an employment survey, demand measurement of job vacancy, and flexible employment statistics. In the empirical study, the report measures the natural rate of unemployment in China, analyzes the reasons for the decline of the labor force participation rate in China, and evaluates the indicator of registered unemployment rates that the Chinese currently government uses. The report emphasizes that the establishment of Chinese employment and unemployment measurement systems should learn and absorb from experiences of developed market economies, while still considering the factors and effects of China being a developing country. We should increase the depth of our research into specific characteristics and rules regarding employment and unemployment measurement systems in developing countries.