China’s job market is showing cracks under the pressure of an economic slowdown, Financial Times reports.
The government plans to intensify fiscal spending, such as investment projects and cutting interest rates, to keep unemployment under control. While the labour market is currently holding up, analyst say that the situation may change overnight. Citi economist Ding Shuang told the FT, “Depending on how deep the growth slowdown is, unemployment can deteriorate very suddenly”. Still, reading China’s unemployment data is a problematic task because it excludes the 200 million migrant workers who are the most vulnerable during a downturn, according to FT.
Partial indicators indicated stress in the job markets: declining job offers (according to purchasing managers’ index) dropping sentiment about employment prospects, and a falling ratio of job openings to job seekers from 108 to 105.
The rapidly cooling property market also meant job cuts and freezes among industrial and construction companies. China’s coal industry may follow suit, according to traders. The job cuts in urban cities are pushing migrant workers back to farmlands.