China consumer outlook for jobs, income fall-survey
BEIJING, Nov 6 (Reuters) - Chinese consumers reckon prospects for jobs and income are their lowest in a year with concerns about career choices and job security their fastest growing worries, according to a survey published on Tuesday.
Despite employment uncertainty, a slight increase in willingness to spend was recorded in the survey of 3,500 Chinese consumers by global information firm, Nielsen, as inflation pressure eased, income growth expanded in double digits and government rebate programmes supported spending.
Nielsen's consumer confidence index has three core sub-components - expectations on employment, expectations on income and willingness to spend.
Nationally, expectations on employment saw a second successive quarterly decline in sentiment on job prospects, pushing confidence back down to the same level as in the third quarter of 2011.
Expectations on income followed a similar trajectory, with the sub-index reading its lowest since Q3 2011, while willingness to spend ticked back up to the same level it sat at in the first three months of 2012.
Worries about personal career prospects and overall job security in the latest survey recorded two of the biggest increases over the same period a year ago - rising by five and three index points, respectively.
The rise in uncertainty about employment has coincided with China's economy recording its slowest growth since early 2009.
GDP expanded at an annual rate of 7.4 percent in the third quarter of 2012, its slowest since the depths of the global financial crisis in the first quarter of 2009 in the aftermath of a virtual standstill in world trade that saw at least 20 million Chinese jobs axed in the closing months of 2008.
China's jobs market has proven more resilient in this downturn, despite a slowdown in growth in foreign demand for products churned out by Chinese factories.
A sovereign debt crisis in the European Union and a slow economic recovery in the United States has sapped consumer demand in China's two biggest export markets this year. Exports to the EU fell 10.7 percent year-on-year in September, versus a 9.8 percent annual rise in September 2011.
China's exports generated 31 percent of gross domestic product in 2011, according to World Bank data, and supported an estimated 200 million jobs. Analysts polled by Reuters expect the economy to have its weakest year of expansion since 1999.
The other notable rise in consumers' concerns in the survey was focused on the welfare and happiness of their parents.
INCOME, FOOD AND HEALTH
The biggest year-on-year decreases in concerns were seen in health and in food prices - both down five index points - though they remain two of the top three worries haunting Chinese consumers. Only worries about income rank higher.
While China's annual rate of consumer inflation has cooled from a three-year high of 6.5 percent hit in July 2011 to 1.9 percent in September, food prices have remained stubbornly above the overall CPI level.
Food inflation was running at a 5.5 percent rate in the first nine months of 2012, well above the government's overall 4 percent CPI target. It is a key worry for policymakers given the high proportion of income Chinese households spend on food.
Nielsen said the overall survey results suggested consumer confidence was stabilising, with double digit rises in disposable income growth helping drive willingness to spend.
The survey found consumers from middle income families with a monthly income of 7,000-9,999 yuan ($1,120-$$1,600) in Tier 1 cities saw a 10-index point jump on willingness to spend in the third quarter versus the previous quarter.
In Tier 2 cites there was a rise of six index points, a rise of five index points in Tier 3 cities and a three point rise in willingness to spend in Tier 4 cities.
Willingess to spend in rural areas was unchanged versus the second quarter..
China's cities are divided into tiers for administrative purposes. Tier 1 comprises China's four biggest cities, Tier 2 the key provincial capitals, with Tiers 3 and 4 established by population size and economic output. Rural areas are separate.