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Duowei: China’s Most Fierce Unemployment Wave May Have Arrived

Duowei, A pro-Beijing news media based in North America, published an article stating that a series of reports on China’s recent economic data have been flashing some worrisome signs.

According to the latest data from the National Bureau of Statistics, China’s rate of consumption and of industrial growth have fallen sharply. Both were lower than expected, even lower than the growth rate during the 2008 financial crisis.

The import and export data for November was far less than expected and the growth rate was less than half of the growth rate for the previous month.

It was a foregone conclusion that China’s auto sales experienced their first recession in the past three decades.

The Caixin (Financial News) survey showed that new export orders from Chinese factories have fallen to their lowest level since February 2016.

The China Manufacturing Purchasing Managers Index (PMI) ended its 15-month expansion in August, showing a four-month losing streak and hitting a two-year low.

Along with this economic situation, the continued deterioration of the employment market is even more worrisome.

At the beginning of this year, the media reported that the giant companies such as Alibaba, Tencent, and Baidu have begun to reduce the number of their recruits significantly.

With the advancement of China’s financial sector reform, China has experienced serious debt defaults of P2P companies. Statistics indicate more than 20,000 people will be forced to lose their jobs in this round of company downturns.

In recent years, traditional industries that supply-side reforms have affected directly have become more and more distressed in the area of employment. The media reported that about 1.8 million people in the coal and steel sectors will face unemployment.

Recently, the State Council of China issued a document, “Several Opinions on How to Improve Employment Effectively in the Current and Near Future.” The most striking item in the document was that “companies participating in unemployment insurance can get 50 percent of their insurance premiums contributed in the previous year reimbursed if they do not lay off or only lay off very few employees.”

However, in the face of these Chinese government measures, some companies do not seem to feel the help was in time. The phenomenon of layoffs has become more and more intense.

Source: Duowei, December 16, 2018