- In Q4 2023, average pay for new hires in 38 major Chinese cities decreased by 1.3%, marking the largest decline since at least 2016.
- Wages in Guangzhou dropped 4.5% from a year ago, while in Beijing they declined 2.7%.
- The administration is working to simplify the data on unemployment.
In Q4 2023, average pay for new hires in 38 major Chinese cities decreased by 1.3%, marking the largest decline since at least 2016. Since statistics on yearly changes were initially made available in 2016, this is the longest stretch of declines, spanning three consecutive quarters.
Wages in Guangzhou dropped 4.5% from a year ago, while in Beijing they declined 2.7%. The data emphasizes China’s growing risks of deflation through 2024, which will negatively impact its development prospects.
Salary fall
Due to a poor job market, people may reduce their spending, which would put more pressure on consumer prices, which are already declining at the fastest rate in three years.
Due to an unclear income future, households may postpone home purchases and avoid taking out mortgages, contributing to the property market’s greatest drop in history.
The year has witnessed substantial pay cuts in China due to regulatory crackdowns and stretched public resources, affecting workers in local government, technology, and finance, among other industries. Additionally, sluggish domestic and international demand for companies’ products is putting pressure on them.
According to a dissection of the official unemployment rate, as of June, over 50% of young people were unemployed, in part because employers are increasingly favoring experienced workers who are willing to accept lower pay and longer hours because they are worried about their future employment.
The administration is working to simplify the data on unemployment. The National Bureau of Statistics’ indicator of consumer confidence indicates that as of November, the sentiment was close to a historical low, suggesting that confidence has not yet rebounded from the levels observed in 2022—a time when lockdowns resulting from COVID-19 were still in effect.
