Top Stories
Top Stories
China Economy

China is facing employment challenges as its economy slows, official says

Key Points
  • On-the-record comments on Thursday by a researcher in China's top executive body provided greater insight into how severe unemployment issues might be, at least in labor-intensive industries.
  • For Beijing, keeping a handle on employment is critical to maintaining control over a massive country of more than a billion people.
  • Unemployment in China remains low compared with other countries, but official reports are beginning to show some challenges in Chinese people's ability to hold jobs.
Female labors work in a cloth factory which exports to European Union in Huaibei, Anhui province, East China.
Jie Zhao | Corbis News | Getty Images

China's economic slowdown is creating some difficulties for national employment, an economic researcher in the country's top executive body said Thursday.

"When we look at the downward pressure on the Chinese economy, what we care most about is employment," said Zhang Liqun, research fellow at the Macroeconomic Department of the Development Research Center of the State Council. Zhang was speaking in Mandarin through a translator at a press event in Beijing on Thursday morning.

For Beijing, keeping a handle on employment is critical to maintaining control over a massive country of more than a billion people. Widespread job losses could lead to undesirable social unrest.

Unemployment in the world's second-largest economy remains low compared with other countries, near five percent or below. But amid persistent skepticism about the accuracy of such data, official reports are beginning to show some challenges in Chinese people's ability to hold jobs.

Zhang's on-the-record comments on Thursday provided greater insight into how severe unemployment issues might be, at least in labor-intensive industries.

"Many of the companies in Guangdong province have permitted leave for their employees since November — many of the export companies," he said. "That has something to do with the U.S.-China trade frictions."

"Many of these companies think they have done what they can do before November and they are not planning to organize further production after that," he said.

VIDEO2:1602:16
Impact of US-China trade war on the toy industry

Tensions between the world's two largest economies escalated last year as both applied tariffs on billions of dollars worth of goods from the other country. The southern province of Guangdong was particularly affected due to its greater exposure to manufacturing and other export-oriented business.

Zhang also noted the trade tensions have caused some companies in industries such as textiles to move operations outside China to neighboring countries. He added that technological development is creating challenges for people whose jobs are being replaced by machines.

As the country grapples with slowing growth, ensuring that people have jobs also has a financial imperative.

"(Beijing's) social policy focuses very much on employment," Zhang said, "and gives priority to the basic well-being of the people, which (has a lot to do with helping) stabilize the consumption."

Related Tags