China’s factory, consumer activity weakens in May, youth unemployment rises
Posted By: Shweta Khandal
Posted On: June 15, 2023
In May, China experienced a slowdown in consumer and factory activity, and there was a concerning rise in unemployment among young people in cities. The economic rebound that followed the lifting of anti-virus controls was not as strong as expected.
Surveys showed that 20.8% of potential workers between the ages of 16 and 24 in cities were unemployed, surpassing the previous record set in April. This indicates that job prospects for young people remain challenging.
The National Bureau of Statistics reported that the economic recovery’s foundation is not yet stable, suggesting that more needs to be done. While economic growth reached 4.5% in the first quarter of the year, meeting the ruling party’s annual target of around 5% will require further acceleration in the coming months.
Retail sales saw a year-on-year increase of 12.7%, but it was lower than the expected rate, indicating that consumers are still cautious about spending. Factory output also slowed down due to decreased demand for Chinese exports caused by interest rate hikes in the United States and Europe.
The youth unemployment rate highlights the significant employment pressure faced by young people, with about 6 million jobless individuals out of a total of 33 million young people seeking work. There is a mismatch between the skills desired by employers and those possessed by job seekers, resulting in a shortage of highly skilled talent.
In addition to these challenges, China’s exports experienced a decline, further impacting the factory workforce. Production, exports, new orders, and employment all declined according to an official survey of manufacturers.
Overall, China’s economic recovery faced hurdles in May, signaling the need for continued efforts to strengthen the economy and address unemployment concerns among young people.
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