China crisis: 20 million lose jobs
Twenty million. That's the official number of out-of-work migrants --- more than the population of Beijing or Mumbai --- who are back in villages in the fallout of slumping global demand for made-in-China products, reports Reshma Patil.world Updated: Feb 03, 2009 01:55 IST
Twenty million. That's the official number of out-of-work migrants --- more than the population of Beijing or Mumbai --- who are back in villages in the fallout of slumping global demand for made-in-China products.
An average of six million workers enter China's rural labour market every year, so this year's migrant job losses could top 25 million.
"About 20 million of China's migrant workers have returned home after losing their jobs as the global financial crisis takes a toll on the economy,'' said State media Xinhua, quoting a senior planning official on Monday. This estimate was released a day after the government issued a document warning that 2009 would be China's 'toughest year' since 2000.
Yiping Huang, chief Asia economist for Citigroup, told Reuters the number could double if government stimulus plans are not effective enough. "It (20 million) is a big number coming from an official source but a lot of people are expecting even bigger numbers," Huang was quoted saying. "These are pretty difficult to check reliably, but people are talking about 30 or 40 million eventually."
About 15.3 per cent of China's 130 million migrant workers have left the cities jobless, Xinhua said, quoting Chen Xiwen, Director of the Office of Central Rural Work Leading Group. The data is based on a survey in 15 provinces.
"Our estimate was that over 15 million jobs, mostly among migrant workers, would be lost in 2009,'' Tao Wang, the head of China economic research at UBS Securities in Beijing, told the Hindustan Times. "We think some of them may find jobs later this year when the fiscal stimulus and recovery of the construction sector takes off.''
But this is not the only unemployment statistic that planners in the world's third-largest economy must downsize to hit the government target of eight per cent growth, generate domestic demand and prevent large-scale social unrest. During the last quarter, China grew at only 6.8 per cent, and annual growth slowed to a seven-year low.
China's colleges will produce at least six million graduates this year. They will compete for jobs with about 1.5 million graduates who ended last year unemployed.