freemexy: With China's Economy Battered By Pandemic

With China's Economy Battered By Pandemic

Jun 17 2020 at 01:45

Since the coronavirus pandemic battered China's economy, tens of millions of urban and factory jobs have evaporated.Some workers and business owners have banded together to pressure companies or local governments for subsidies and payouts.To get more news about Shanghai economy news, you can visit shine news official website.

But many of the newly unemployed have instead returned to their rural villages. China's vast countryside now serves as an unemployment sponge, soaking up floating migrant workers in temporary agricultural work on small family plots.

"Say a factory used to hire 1,000 temporary workers; now, without new orders, these business owners can't afford to hire this many people," Yan Xiyun, a labor intermediary, told NPR. "The factory I usually go to in previous years could easily hire 2,000 people. Now there is scarcely anyone [on the factory floor]."

Ten years ago, Yan left her own village near the small city of Zhumadian in Henan province for the first time and joined the migrant workforce. Now, she's a headhunter working on commission, placing thousands of villagers like herself in electronics factories.

However, with the economy badly struggling, Yan says hourly salaries have dropped, some by more than 35%. So has the number of villagers she's been able to place in manufacturing hubs like Shenzhen and Dongguan, in China's south.

"Factories are all laying people off. They cannot possibly pay all their workers when they have no orders going out and no imported goods coming in," says Yan.The global economic slowdown could imperil China's goal to eradicate rural poverty by the end of 2020, a centerpiece initiative of Chinese leader Xi Jinping when he took power in 2012.

Some 5.5 million rural residents are still living under the poverty line, which China defines as annual income below 2,300 yuan ($324). (In comparison, the World Bank defines extreme poverty as living on less than $1.90 a day, or $694 a year.)

Researchers at Stanford University and Beijing's Renmin University who sampled nearly 700,000 villagers from seven Chinese provinces this year found measures to mitigate the spread of the virus have so dramatically reduced migrant workers' incomes that most have been forced to buy less food.

"In late April, only about half of those rural workers who were working last year were [still] working," said Scott Rozelle, a Stanford economist who led the team of researchers. "This is a good and bad news story. There was very little disease outbreak and China did many things to try to cushion the effect of the lockdown. But there were negative employment effects."

Worse, only about 10% of China's jobless normally receive state unemployment benefits because of stringent requirements that favor white-collar work. Unemployment insurance is only available to those who have paid into public funds for more than 12 months along with contributions from their employers. A vast majority of migrant laborers, whose jobs are seasonal, do not qualify.

Instead, the only recourse for hundreds of millions of migrant workers lies in a return to the land. But outside Zhumadian, among its dusty, golden wheat fields, villages are also feeling economic pain.Like many cities in central China, Zhumadian is a steady source of migrant workers who staff restaurants and factories from Shanghai to Shenzhen. This year, because of its proximity to the epicenter of the coronavirus epidemic in neighboring Hubei province and strict lockdown measures, those workers found themselves stranded in their villages without work.

Late in February, the Zhumadian municipal government was so desperate to get people back on the job, it chartered buses for hundreds of workers, ferrying them from Zhumadian's rural fringe to electronics factories in Guangdong province, more than 800 miles away. But by April, a plunge in consumer demand caused many smaller factories to close their doors for the rest of the year, only weeks after they had reopened as lockdown measures eased.

Among those who left and then returned were residents of Big Zhao Village, so named because everyone in there is related and has the same surname, Zhao. Those who would normally travel hundreds of miles for work must now opt for temporary jobs closer to homes, where wages are much lower.

"My daughter just returned to the village! The electronics factory ended up closing. Because of the coronavirus, no one is buying anything in China and the factory can't import goods," said Zhao, who didn't give his full name because he felt ashamed talking openly about his family's unemployment.


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