China said it will spend as much as 100bn yuan over the next two years to train and re-employ the factory workers terminated from various firms in the past.
The workers who lost their jobs as part of capacity rationalization in industrial units started in the steel and coal sectors will benefit from this move.
It was in September last year the world's second largest economy decided to take stringent measures to clean up and improve state-owned enterprises by allowing private ownership in the firms.
Feng Fei, deputy minister for industry and information technology said on Thursday that the government also wants companies to restructure or merge with others to avoid layoffs.
The government has vowed to first start phasing out overcapacity in the steel and coal sectors
Beijing had said last year that it was expecting decisive results of the reform moves by 2020.
"While doing this, our major concern is to resettle workers sacked in the restructuring," Feng said.
China said it is also planning to take specific action for developing more domestic consumer brands.
South China's Dongguan City recorded 8% growth in 2015, as the production base for mobile phones and garments shifted to innovation and technology to take up the slack of traditional manufacturing, Xinhua reported on Wednesday.