BEIJING -- China's online shops have created nearly ten million jobs, but a lack of social insurance has failed to give employees a sense of security.

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There are more than 9.62 million online shop owners and employees in the country, while about 1.22 million roles are vacant, according to a report by China Association for Employment Promotion.

The report showed more than 40 percent of owners of individually-run online shops and nearly 76 percent of their employees are not covered by any type of social insurance, while the figures for company-run online stores are 32.7 percent and 52, 4 percent respectively.

In 2013, the online retail market expanded to over 1.8 trillion yuan ($293 billion), a year-on-year increase of 42.8 percent, according to the China e-Commerce Research Center.

Despite the Internet business boom, a majority of online shops are small in scale with each hiring on average only 2.55 people, according to the report.

"It's too expensive for a small business like us to pay for insurance for employees," said the owner of a paper toy store at Taobao.com, who preferred to remain anonymous.

Zhang Xiaojian, head of China Association for Employment Promotion, was quoted in the People's Daily as saying the priority should be to cover workers with medical and old-age insurance.

Most of the people working for online shops are under the age of 35 and the stores are usually disadvantaged because of a short operation history, low profit and unstable transactions, according to Zhang.

He suggested the government give preferential policies and lower insurance payments to encourage both employers and workers to pay into social insurance programs.