News 360》China's 'Economic Hardship Goes Viral,' Young People Express Their Feelings! Experts Reveal the Real Disaster Is Just Beginning...

Image source／@LTN-news     https://www.youtube.com/watch?v=2lBi8fw_sFU

Reporter Huang Xingya: China's economy continues to decline, and youth unemployment remains high. It reached an all-time high of 21.3% in June last year, causing the government to temporarily stop publishing the data, saying it wanted to evaluate how to collect data. One year later, there is still no solution. Despite the adoption of a new statistical method in July this year, the youth unemployment rate is still as high as 17.1%. A video that went viral in the community recently revealed the true employment situation.

Chinese Blogger (in the video):I remember last year, I met you in Longhua (Guangdong). You were also sleeping in the square with some people in Longhua. I heard from Chunhong that you went to work in the factory.

Homeless Woman (in the video):I was working all the time last year, so it’s hard to find a job this year.

Reporter Huang Xinya:The woman said that because it was hard to find a job, she usually made a living by begging. Many people left messages lamenting, if it was not impossible, who would want to live like this? The key is that there is no hope, and under the adverse general environment, even if you are lucky enough to keep your job, you may have to face the crisis of salary cuts. There was a hot discussion on Weibo a few days ago. Some companies asked their employees to change their salary to three and reduce their salary by RMB 1,000 because their profits were not as expected.

       Scholars interpret this as a response strategy adopted by companies as the government bans layoffs and raises the unemployment rate.

Dr. Wang Guocheng:Our long-term judgment is that it should become a zombie country. The so-called zombie country means that your company will not let it fail. What next? Companies are not allowed to lay off employees. Every company seems to be open and not bankrupt. However, they (the companies) have no production capacity at all, and the country's economic idleness will continue. Another background is that in the three years since the epidemic, because the Beijing authorities did not allow layoffs, they actually provided bailout loans. However, after the epidemic, this aspect has gradually decreased. Therefore, what enterprises directly face is the cost pressure of employees (paying salaries). This kind of four-day work and three days off (four days of work and three days of vacation) reflects the bleakness of the entire enterprise facing deflation.

Image source／@LTN-news     https://www.youtube.com/watch?v=2lBi8fw_sFU

Reporter Huang Xinya:In China's economic downturn, in addition to "unfinished buildings", the term "unfinished children" has even emerged, which refers to the generation who are unemployed after graduation. After a fiercely competitive education stage, they are finally forced to accept low wages or even low wages. There was no job to be found.

Dr. Wang Guocheng: Because the vacancy situation of the entire enterprise is not so ideal, so what? Finding a job is not easy. In fact, as early as two years ago or more than a year ago, everyone was talking about the rising unemployment rate among young people. They would return home. They called them stay-at-home children. In Taiwan, they called them nibbling on the elderly. But in the long run, there will be two problems. The first is that once these young people do not enter the workplace after graduation, it will be more difficult for them to enter the workplace over time. For the entire mainland of China, the labor rate of young people once they graduate is no different. . However, mainland China is now slowly experiencing a declining birthrate and an aging population, and that is the beginning of the disaster.

Reporter Huang Xingya: Recently, an online survey by Beijing Daily revealed that many young people would rather have their salaries cut in order to keep their jobs; however, there are also those who have experienced the new system. On the surface, it looks like they are following the example of Europe and the United States in working four days, but in fact, they are forced to take holidays. Going to work without any subsidy from the company seems to be hiding a greater crisis.

Dr. Wang Guocheng: It highlights that mainland China currently has overcapacity. You can see several data, ex: imports, whether they are foreign investment imports or high-tech product imports, including equipment, are shrinking, and it has been as long as 2 years; second The PMI (Manufacturing Purchasing Managers Index) continues to be below 50%. The company itself is reducing production capacity, but the consumption of the people and society is sluggish faster than it is reducing production capacity. Supply is greater than demand, so why is it said that he wants to go abroad? Arrival from outside.

Reporter Huang Xingya: A major key to corporate overcapacity is that people are not optimistic about the prospects and would rather save than consume or invest if they have money, which has led to various financial data continuing to be disappointing. The People's Bank of China announced that new credit in July this year was only 260 billion yuan, about NT$1.16 trillion, setting a new low in the past 15 years.

Image source／@LTN-news      https://www.youtube.com/watch?v=2lBi8fw_sFU

Dr. Wang Guocheng: In fact, if you look at it over a longer period of time, we counted it at that time, and it was already negative about three times in a year. Not only were there no (new) loans, but the loans were still being repaid. This is called a "balance sheet recession." , that is to say: I have money, I don’t use it for consumption or investment, but I have money to repay the loan first; then the second one is the liquidity trap, which is the same concept. When you have more stimulus policies, , whether you cut interest rates or lower reserve requirements, people are desperately trying to find ways to save money first instead of using it for consumption and investment. The second thing is that if you don’t use it for investment, then companies will have no capital to expand production capacity, so this is also It will suppress the company's subsequent operations, and (people) can see that it is bearish on the future prosperity and prospects.

Reporter Huang Xingya: The Chinese people are complaining endlessly. Scholars interpret this as the direction of China’s economic development and policy in the future.

Dr. Wang Guocheng: To put it bluntly, what he has to deal with now is the problem of overcapacity and the real estate bubble. Basically, we believe that if there are no accidents in mainland China, this zombie economy will continue to exist, and drag it on... until the entire real estate crisis is over. After roughly dealing with it, they then think about subsequent economic development. This highlights that Xi Jinping does not care so much about short-term stimulation, but rather long-term economic structural adjustment. The key point internally is to hold on to the banks and prevent them from bursting, so that a large-scale financial crisis will not occur. The external point is the exchange rate. They want to suppress the national debt, and the purpose is to maintain exchange rate stability. He ignores the present and focuses on the long term, an approach that only occurs in communist and authoritarian countries.

Reporter Huang Xingya: At present, pessimism is gradually spreading in Chinese society, and many people believe that no matter how hard they try, progress seems to be stagnant. A questionnaire survey by American scholars White and Russell also found that more and more people are beginning to blame their predicament on an unfair system, which also shows that dissatisfaction is intensifying.

Reporter Huang Xinya: Interview and report.

Source: Liberty Times News/2024/08/23 19:12
Reporter: Huang Xingya
Original source：https://news.ltn.com.tw/news/world/breakingnews/4778454 
                            ：https://www.youtube.com/watch?v=2lBi8fw_sFU
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