The Institute of Economics of the Chinese Academy of Social Sciences recently released an analysis of China’s unemployment trend based on its May survey data.

The Paper reported the academy’s article on July 9. The number of Chinese people having no job has been changing in response to this year’s COVID-19 wave by far, which heightened in March and started to level off after April.

In May, the unemployment rate on a national scale decreased to 5.9% from 6.1% in April. Reversely, however, the figure in 31 large cities and towns only increased to 6.9%. 

The report commented that the pandemic has caused a greater impact on start-ups, and individual industrial and commercial households who have poured into big cities. This has sunk employment capacity sequentially.

Additionally, the numbers reflect the fact that COVID-19 outbreaks have clustered around critical centers of the country, including the financial hub Shanghai and the capital Beijing. 

Nonetheless, the report believed the unemployment rate in these cities will fall back to its pre-pandemic level, which was before March.

At the same time, the academy projected that jobless rates for youngsters will exacerbate in July and August, as this is the time graduates officially leave school. Already, the figure has worsened in May, climbing to 18.4%, which is also a new high since 2018. 

This year, China’s number of graduates reached a record high. However, the report noted that businesses’ need for new hires in May only decreased as a result of the pandemic. This means the supply-demand mismatch would increase.

Data on new employment did not provide any condolence either. According to the report, only 1.23 million people in China were really employed as of May. It is an unchanged figure in March and April, and worse than the same period in 2021.

The ongoing job market imbalance, cooped with continuous unemployment issues will undoubtedly reduce people’s income and lower their willingness to spend money. As a result, the report concluded that consumption recovery will remain gloomy in the meantime. 

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