Prior to Deng Xiaoping's economic reforms, a work unit acted as the first step of a multi-tiered hierarchy linking each individual with the Chinese Communist Party infrastructure.
The work unit provided lifetime employment and extensive socioeconomic welfare -- "a significant feature of socialism and a historic right won through the Chinese Revolution.
[2]: 32 Some scholars believe that the social, economic, and political functions of the danwei could be traced back to the pre-communist financial institutions in the 1930s, the labor movement between the 1920s and 1940s, and the rural revolutionary models of organization in the Yan'an period.
[3] Among them, the heavy industrial work units, commonly viewed as the prototype of the socialist workplace, were granted priority for resources.
[8] Among the goals that state planners sought to advance through constructing danwei as part of China's urbanization was the development of a socialist citizenry with a proletarian consciousness.
The CCP's creation of a danwei system that was based strictly on functionalism represented a break from the previous imperial China's focus on Confucian principles of hierarchy and order.
[10] As a result of danweis being such a socially enclosed and monitored environment, people became hyperaware of their behaviour and strived for absolute conformity which gave way for the "penetration of the Leninist state in urban society.
[15] Along with the emotional and physical devastation in China, this ultimately led to exhaustion of the labor force from endless attempted "brainwashing" in danweis.
[15] In the years during the Chinese economic reform beginning in 1976 and ending in 1989, led by Deng Xiaoping, the policies surrounding the permanency of the employee to the work unit became more lax, particularly in enterprise units (qiye danwei) where there was an increasing lack of a personnel dossier (dang an) system that prevented people from transferring or quitting.
[17] Between 1962 and 1965, during the Mao era, Beijing's leaders adopted emergency measures after the Great Leap Forward resulted in mass starvation and agricultural downturn.