China’s factory, consumer activity weakens in May, youth unemployment rises

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BEIJING (AP) — China’s consumer and factory activity weakened in May and record-breaking unemployment among young people in cities rose as an economic rebound following the end of anti-virus controls slowed.

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Hey there, time traveller!
This article was published 14/06/2023 (1175 days ago), so information in it may no longer be current.

BEIJING (AP) — China’s consumer and factory activity weakened in May and record-breaking unemployment among young people in cities rose as an economic rebound following the end of anti-virus controls slowed.

Surveys found 20.8% of potential workers in cities aged 16-24 were unemployed, up from April’s previous record of 20.4%, the government reported Thursday.

China’s economic activity rebounded after the ruling Communist Party in December lifted controls that cut off access to major cities for weeks at a time and blocked most international travel. But consumers, uneasy about possible job losses, returned to shops and restaurants less quickly than expected.

A man takes a nap next to another browsing tablet computer at a cafe inside a shopping mall in Beijing on May 24, 2023. China’s consumer and factory activity weakened in May and record-breaking unemployment among young people in cities rose as an economic rebound following the end of anti-virus controls slowed. (AP Photo/Andy Wong)
A man takes a nap next to another browsing tablet computer at a cafe inside a shopping mall in Beijing on May 24, 2023. China’s consumer and factory activity weakened in May and record-breaking unemployment among young people in cities rose as an economic rebound following the end of anti-virus controls slowed. (AP Photo/Andy Wong)

“The foundation for the economic recovery is not yet solid,” the National Bureau of Statistics said in a report.

Economic growth accelerated to 4.5% over a year earlier in the three months ending in March from the previous quarter’s 2.9%. Growth will have to accelerate in coming quarters to hit the ruling party’s annual target of “around 5%.”

“The data published today suggest that the reopening recovery had largely fizzled out by May,” Julian Evans-Pritchard of Capital Economics said in a report. “The economy appears to have lost some further momentum during the first half of June, too.”

Retail sales rose 12.7% over a year earlier, but that was down from April’s 18.4%, which was barely half the rate expected by forecasters. Growth in factory output decelerated to 3.5% from the previous month’s 5.6% after interest rate hikes in the United States and Europe to cool inflation depressed demand for Chinese exports.

The youth unemployment figure represents about 6 million jobless people out of a pool of 33 million people aged 16-24 who want to work, according to the NBS spokesman, Fu Linghui.

“The employment pressure of young people is still significant,” Fu said. He said there was a mismatch between job seekers and the skills wanted by employers, leading to a “shortage of highly skilled talents.”

May exports, reported earlier, tumbled 7.5% from a year earlier, reversing from the previous month’s 8.5% growth and adding to pressure on China’s factory workforce. An official survey of manufacturers found production, exports, new orders and employment declined.

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