Chinese Economics Thread

[KYli]

China youth unemployment would peak on July and go down until Dec. Expect two more months of nonstop coverage from the West and liberals in China talking about doom and gloom of China.

I am more interested in how much youth unemployment would go down between August and December. It would be an indicator of the strengthen of the Chinese economy and if a further and stronger stimulus is needed to jump start the recovery or not.

 

[Eventine]

Okay? How does this change any of the problems that China have today? You've not answered my question about whether you believe that 20% youth unemployment is superior to 10%. Do enlighten us all. I've bet on China

My understanding is that this is mostly migrant workers becoming unemployed due to slow downs in low skill manufacturing (which is increasingly automated; and also subject to global demand declines and higher average wages in China) and services (due to the lock downs bankrupting many small and medium service businesses).

The former can't really be fixed. Manufacturing workers have to skill up because the economy is changing and it's not possible for China to employ that many assembly line workers anymore - low skill manufacturing industries are just disappearing or shifting to lower wage countries.

The latter can be fixed. And here is where the government can be blamed for not acting more quickly to restore service jobs and support small and medium businesses after the lock downs ended.

 

[Deleted member 24525]

wrong. LOL

China is communist only by name. they will always claim to be communist. No doubt about it. But it’s economy is practically national socialist.

White people will never understand the Chinese mindset. no matter what they do.

You have no idea what you're talking about.

 

[abenomics12345]

The author 王明远 is not a subject matter expert in economics. He's a lawyer.

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He gives no public source for the data he cites.

Try again, 王明远

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is a researcher at a think tank and he used to work at 中国经济体制改革研究会 which is a subordinate organization to the NDRC.

This is interesting. You say that increasing tertiary education and high youth unemployment is a sign of weakness.

I specifically said "a problem in the future", not a "sign of weakness". How difficult is it for you to delineate the difference?

Look, the point here is simple, nothing you've said addressed why the unemployment rate for 16-24 YO population doubled in 3-4 years.

 

[FairAndUnbiased]

You're talking about a state who's founding ideology was written by a foreigner. China is an incredible place with a long history but it's not magic. An outsider can come to understand it through diligent study over an extended period.

China's founding ideology was written by Mao Zedong, Zhou Enlai and Liu Shaoqi. I was not aware that they were foreigners.

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[sunnymaxi]

You have no idea what you're talking about.

you people absolutely know nothing about China.

 

[FairAndUnbiased]

Try again, 王明远

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is a researcher at a think tank and he used to work at 中国经济体制改革研究会 which is a subordinate organization to the NDRC.


I specifically said "a problem in the future", not a "sign of weakness". How difficult is it for you to delineate the difference?

Look, the point here is simple, nothing you've said addressed why the unemployment rate for 16-24 YO population doubled in 3-4 years.

I don't know every little think tank.

I already addressed it: Chinese economy is greatly increasing in complexity and is so productive with less labor inputs that low skilled labor is becoming less necessary.

Here we see data that corroborates it, by showing 25-59 age bracket has lower unemployment among college graduates.

Thanks @sunnymaxi for pointing out the source.

https://twitter.com/i/web/status/1666045567040995331

 

[2handedswordsman]

It is just a short term problem. As more and more Chinese retired and the number of college graduates start to decline, the youth unemployment would go away. We are at the peak of new college graduates as colleges enroll nearly everyone possible. And at the same time, only a few years away from massive retirement from those born in the 60s and 70s.

i don't think that is a short term problem. This exact youth unemployment rate indicates two facts. One is that the low skilled jobs are declining because of the massive implementation of automation and the second is that there is the massive number of high educated youth jobseekers which because of the high antagonism need to proceed to post docs, master degrees etc. Both two, soon will force to tackle a classic Marxist theme, the re-calculation, adoptation of the average socially necessary working time. Is the classic 8 hour shift up to date of the present social needs? Neoliberals answered this question by deformalising and destructing labour rights in favour of course of the capitalist. Because of the combination of high salary and high productivity the boss can tell you"i don't care about your ultra skills, i need you for 4 hours". You can see these phenomena in the emerging in the West where precarious jobs, high unemployment(not only youths), future insecurity is the main trend. A whole generation of youth sharing -without being a family- an insanely overpriced rented house, or staying with parents till 30-40's is being formed in Europe. American dream is already past and will be never back. As PRC economy is getting mature the great question emerges too. Will PRC sacrifice it's majority of people to favor a few individuals? If CPC remains firm Communist, the answer is obvious. But we will just wait and see because humans are humans

 

[abenomics12345]

I think the main problem here is that the metric for youth unemployment as defined in China is just not really meaningful

https://twitter.com/i/web/status/1666045567040995331

There is a credible argument here that @Eventine made (see below) that there is an increasing skills mismatch in the labour force between demand/supply of workers. This, while not a sign of economic weakness, is still a problem that needs to be dealt with.

China youth unemployment would peak on July and go down until Dec. Expect two more months of nonstop coverage from the West and liberals in China talking about doom and gloom of China.

I am more interested in how much youth unemployment would go down between August and December. It would be an indicator of the strengthen of the Chinese economy and if a further and stronger stimulus is needed to jump start the recovery or not.

We'll see, I hope you're right.

My understanding is that this is mostly migrant workers becoming unemployed due to slow downs in low skill manufacturing (which is increasingly automated; and also subject to global demand declines and higher average wages in China) and services (due to the lock downs bankrupting many small and medium service businesses).

The former can't really be fixed. Manufacturing workers have to skill up because the economy is changing and it's not possible for China to employ that many assembly workers anymore - low skill manufacturing industries are just disappearing or shifting to lower wage countries.

The latter can be fixed. And here is where the government can be blamed for not acting more quickly to restore service jobs and support small and medium businesses after the lock downs ended.

Careful there, the latter point you raise would invite the extremists here with:

<facetious> how dare you blame the government!? it's all a plan </facetious>

Automation is definitely happening, but that largely applies to manufacturing workforce which is ~100mln or so according to an NBS Survey. That workforce will shrink over time as workforce ages. However, it is definitely true that there is a skills mismatch and that is the problem I've alluded to. The problem here, is that the pressure to employ more university graduates will grow as tertiary enrollment has grown substantially. The point that @FairAndUnbiased does not seem to understand is that having a lot of STEM graduates and university graduates is great *only* if there are sufficient jobs for them that maximizes their skills (and therefore wages). Having 50mln highly educated and under/unemployed STEM university grads working as delivery drivers/DIDI drivers is how you have the precursor of social unrest.



I'm just going to leave this data here for you to read.

 

[Deleted member 24525]

China's founding ideology was written by Mao Zedong, Zhou Enlai and Liu Shaoqi. I was not aware that they were foreigners.

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And the entire conceptual framework they used was created by a German man.

you people absolutely know nothing about China.

I get these knee jerk reactions every time I acknowledge or even imply that China has made use of something foreign in the course of its development, whether technological or ideological, and it's really starting to get on my nerves.
Literally every developed country except for Britain made its start by importing and absorbing foreign technology and managerial knowledge, including the likes of Germany Japan, and the United states. It's a fact of development, there's nothing shameful about it. In fact it should be a point of pride for China that it has done this at a speed and scale far greater than anybody else.

But I guess accepting that China has made heavy use of foreign technology and political thought in the course of its development would infringe on the idea of it being supernaturally different, of not being subject to the same developmental constraints as literally everybody else, of having magically reinvented 200 years worth of technological progress in the span of 40 without any reverse engineering.