China’s workers suffer biggest drop in hiring salaries on record
WAGES offered to Chinese workers in major cities declined by the most on record, underscoring persisting deflationary pressures and sluggish consumer confidence in the world’s second-largest economy.
Average salaries offered by companies to new hires in 38 key Chinese cities fell 1.3 per cent to 10,420 yuan (S$1,938) in the fourth quarter of 2023 from a year ago. That was the worst drop since at least 2016, according to data from online recruitment platform Zhaopin compiled by Bloomberg.
It’s also the third straight quarter of decline, the longest run since data on yearly changes were first available in 2016.
In Beijing, the wages decreased 2.7 per cent from a year ago in the fourth consecutive quarter of contraction. Salaries in the southern metropolis of Guangzhou fell 4.5 per cent.
The data highlights the mounting deflation risks faced by China going into 2024, which weigh on its growth outlook. A gloomy job market means residents could pare back their spending, adding to downward pressure on consumer prices that are already falling at the steepest pace in three years.
It also bodes ill for the property market, which is extending its worst slump in history. With an uncertain income outlook, households could continue to delay their home purchases and avoid taking out mortgages.
A consumer confidence index compiled by the National Bureau of Statistics shows sentiment hovered around a historical low as of November, the most recent month for which data is available.
The index takes into account residents’ assessment of their income, employment and willingness to spend. It shows confidence is yet to improve from the levels seen in Covid lockdown-hit 2022. BLOOMBERG
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