Fearing slump, rattled Chinese long for advice

Ms Lin Mo, a popular online financial advice columnist in China, says she gets hundreds of messages from young professionals who are terrified about their prospects during an economic slowdown.
Ms Lin Mo, a popular online financial advice columnist in China, says she gets hundreds of messages from young professionals who are terrified about their prospects during an economic slowdown.PHOTO: THE NEW YORK TIMES

Many young professionals have known only boom times and fear abyss of a downturn

BEIJING • In recent days, an advice column has circulated widely on China's most popular social media phone app. Titled "Guide on Safe Passage Through the Economic Crisis", it is aimed at young Chinese urban professionals. Its nuggets of wisdom include: "Work hard at your job so you are the last to be laid off" and "In an economic crisis, liquidity is the No. 1 priority."

Ms Zhang Yuanyuan, 31, a bank teller in Shandong province, is among the thousands of people who have shared it online. "Last year we didn't have any year-end galas or a bonus," she said in an interview. "I think this year will be the same," adding: "I try to spend less." She buys cheaper clothes online instead of shopping at malls. "And I started carpooling with co-workers to save on petrol."

Many young middle-class Chinese who grew up during the nation's glittering boom years, when double-digit growth was the norm, are suddenly confronting the shadow of an economic slowdown and even hints of austerity.

They are talking of cancelling holidays, delaying weddings and even selling recently bought apartments to have cash on hand. Those who have lost money in the ongoing stock market crash are especially anxious.

Their angst poses dual problems for China's leadership. The ruling party bases its legitimacy on delivering high rates of growth and jobs. It also hopes to stoke consumer spending as a new engine of growth as the manufacturing economy slows. Eroding confidence threatens both goals.

This month, the central bank devalued the currency, the yuan, by the largest amount in decades, signalling to outsiders officials' worry over China's growth rate, which the government had earlier projected at 7 per cent for the year.

Then the sharp drop in the Chinese stock market, following a steep midsummer fall that had been slowed only through muscular government intervention, destabilised bourses worldwide.

Communist Party officials have been trying to blunt the dire news at home. Not only have the main party newspapers refrained from publishing relevant articles on their front pages, but security officials have also shown a willingness to go after Chinese reporters whose stories deviate from the official narrative.

But censors have yet to prevent people from using search terms related to the economy or the stock market on social media networks, so discussion is thriving online.

"In the absence of information about the stock market on official media, Chinese investors are relying on social media, primarily the two 'We's - Weibo and WeChat - to get news about the economy," said Mr Xiao Qiang, founder of China Digital Times, which tracks media censorship.

He noted that WeChat was particularly popular because it was less "polluted" by posts from government-supported Internet users and because people could easily share news articles on the economy from Western news publications, especially stories already translated into Chinese.

The author of the widely circulated financial advice column on WeChat, Ms Lin Mo, once worked for a state-run business magazine, then decided to devote her time to her own online writing about the economy. She said in an interview that she had published her latest list of suggestions after getting hundreds of messages from "very terrified" readers responding to one of her earlier essays on what she called an "economic crisis".

"Many readers were asking me things like, 'What should we do?' and 'What if China becomes Japan in the '80s?' " she said. "They are in their early 30s - the age to buy apartments or make investments or start their own businesses. So they have big financial decisions to make, and in the current economy, they worry about losing those investments in the slowdown.

"One reader told me that he left a state-owned travel agency to join a booming Internet-based travel service because he felt he had to 'embrace the Internet' as a young professional. Now he regrets that decision bitterly because the new company is having layoffs, and he might be laid off first."

Among the most worried are university graduates. This year, nearly 7.5 million people graduated from universities in China, a 3 per cent increase over last year.

"The difficulty of finding employment in 2015 is still relatively high," said a director of the career centre at the Ministry of Education, on the ministry's news site. "Both the central and local economies' growth rates have entered the 'new normal'."

Ms Lin said China's young strivers "worry about never getting that financial freedom they so badly want... about never being able to start their own business".

Leisure spending still exists, of course. Popular restaurants in Beijing are crowded. This month, groups of Chinese tourists snapped up all manner of luxury goods one weekend at Galeries Lafayette in Paris, a high-end destination. Tour groups shuffled through the alleys and luxury shops of Venice.

But on Zhihu, the Chinese equivalent of the question-and-answer website Quora, hundreds of people have submitted responses to questions from 2014 and 2015 that asked: "What things do you see in your profession that indicate an economic slowdown?" The answers this year have ranged from "I'm in sales - commission is impossible" to "I'm in construction. Last year we got four jobs and this year none. Layoffs have started."


A version of this article appeared in the print edition of The Sunday Times on August 30, 2015, with the headline 'Fearing slump, rattled Chinese long for advice'. Print Edition | Subscribe