The negative list system for market access is a significant institutional arrangement for deepening the reform of the socialist market economy. In this context, an in-depth exploration of the impact of market access deregulation on employment and its underlying mechanisms is of great importance for guiding policy formulation, alleviating employment pressure, and enhancing the flexibility of the labor market.

This paper utilizes samples from China’s A-share listed companies from 2008 to 2022 and employs a quasi-experimental design based on the negative list system for market access to construct a multi-period DID model and investigate the impact of market access deregulation on employment. The findings reveal that market access deregulation significantly promotes employment growth. Mechanism testing indicates that market competition effects, output expansion effects, and production efficiency improvement effects are the key channels through which market access deregulation facilitates employment. Heterogeneity analysis shows that market access deregulation notably increases the overall employment of individual businesses. In capital-intensive and labor-intensive enterprises, as well as in enterprises operating in regions with a higher degree of market segmentation and in industries with higher entry barriers, market access deregulation has a significant positive effect on employment. Further analysis reveals that market access deregulation promotes the sustainable development of enterprises, leading them to pay more attention to the foundational aspects of the real economy, thereby further enhancing the employment effect of market access deregulation.

The contributions of this paper are as follows: First, it focuses on a thorough investigation of the impact of the market access deregulation reform on employment within the Chinese market. Second, it integrates production efficiency into the employment determination model and utilizes the Nash equilibrium solution to identify the paths through which the reform promotes employment. Third, it conducts an in-depth analysis of the behavioral choices made by enterprises following market access deregulation and the subsequent impact of these choices on employment. Fourth, it explores whether market access deregulation can promote the sustainable development of enterprises and whether such sustainable development can further enhance the positive effect of market access deregulation on employment.