Updated March 11th, 2024 at 09:31 IST

Perceived recession grips China despite official economic growth

China's economy faces downturn with high Gen Z unemployment, stagnant wages, and property market woes amidst external pressures.

Reported by: Business Desk
China real estate | Image:Shutterstock

China's economic downturn: Many individuals in China are experiencing a sense of economic downturn, reminiscent of a recession, despite official growth figures, according to Reuters report. Melody Zhang, a recent graduate from Renmin University, faced disappointment when she failed to secure a government job after numerous unsuccessful attempts in the media sector. The fierce competition for limited positions, with 2.6 million applicants vying for 39,600 government roles, reflects the challenges many young people encounter in finding employment.

Graduate job struggles

Zhang's experience is not unique, as a growing number of young graduates are struggling to realise their career aspirations amidst economic uncertainties. The prevailing sentiment amongst them is one of frustration and disillusionment, with concerns about the shrinking job market and diminishing prospects for advancement.

Economists like Zhu Tian argue that despite China's official growth rate of 5.2 per cent last year, the reality on the ground feels more like a recession for many. Factors such as declining property values, stagnant wages, and subdued consumer spending contribute to this perception of an economic downturn.

China's Gen Z challenges

The situation is particularly dire for China's Generation Z, who face high unemployment rates and lower-than-expected salaries when they do find work. This marks a significant departure from previous decades of rapid economic growth, fuelled by massive investments in manufacturing and infrastructure.

The property market, once a pillar of China's economic growth, is now experiencing a downturn, with many homeowners feeling the pinch as property values plummet. This has significant implications for household wealth and consumer spending, further exacerbating the economic challenges facing the country.

Geopolitical economic strain

Moreover, external factors such as diplomatic tensions with the West and trade restrictions are adding to China's economic woes, with businesses feeling the impact of these geopolitical tensions on their operations.

In light of these challenges, many individuals, like tech consultant David Fincher, are contemplating their future in China, fearing further economic instability and regulatory uncertainties. The prevailing sentiment amongst them is one of uncertainty and anxiety about what lies ahead.

(With Reuters Inputs)


Published March 11th, 2024 at 09:31 IST