China loses five million jobs in trade war
The industrial sector has been hit hard in the past year. Almost two million jobs disappeared because of the clash with Washington. The politburo seeks new ways to shore up employment, a key sector for the country’s political and social stability. Meanwhile, multinationals leave.
Beijing (AsiaNews/Agencies) – China’s industrial sector lost about five million jobs last year, including almost 1.9 million as a result of the trade war with the United States, this according to China International Capital Corp (CICC) economists Liang Hong and Yi Huan.
The two analysts suggest that the job market is not as stable as the government claims. Total job losses represent 3.4 per cent of total employment in the industrial sector, which includes mining, manufacturing and public utilities, and 0.7 per cent of total national employment.
CICC’s research did not factor in the effect of tariff increases of 10 to 25 per cent on US0 billion of Chinese imports, which came into force in May. That omission suggests that job losses will continue to grow.
The 25 members of the Communist Party politburo are expected to hold their quarterly meeting on the economy before the end of the month and may propose new policies to shore up growth and employment.
For its part, the government has not published official data on job losses resulting from the trade war, but has estimated the dispute would reduce national gross domestic product by 0.5 per cent.
Another risk factor is the flight from China of various multinationals, fearful of rising operating costs and the effect of US tariffs.
Sony Mobile shut down its Beijing factory in March, while South Korean phone maker Samsung is expected to close its Huizhou plant before September.
The CICC recommends “bigger policy support for labour-intensive industries, such as the consumption-driven services sector and the investment-driven construction sector, including further tax cuts and a lowering of financing costs”.
Domestic employment is one of six crucial areas in which the Chinese government vowed in July 2018 to maintain political stability.
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30/10/2020 12:53
26/10/2020 10:15
