BEIJING - President Xi Jinping on Sunday underscored the importance of a healthy labour market in China’s ongoing drive to narrow its wide inequality gap, as the job outlook in the world’s second-largest economy remained gloomy.
Describing jobs as the mainstay of income spread in the country, Mr Xi vowed to ensure fairer wealth distribution in one of the world’s most unequal societies, and to grow its middle class.
“We will keep income distribution and the means of accumulating wealth well regulated (and) intensify efforts to create jobs,” said Mr Xi in his speech at the opening of the 20th Congress of the Communist Party of China.
“We will ensure more pay for more work and encourage people to achieve prosperity through hard work.”
Employment prospects, particularly for young Chinese people, remain bleak due to a sharp slowdown in economic growth.
The latest official statistics show that the jobless rate in August for those aged 16 to 24 stood at 18.7 per cent, almost quadruple the urban unemployment rate of 5.3 per cent. In July, the jobless rate for young people was at a record high of 19.9 per cent.
Mr Xi promised that the government will “refine the public service system for employment, do more to help those with difficulties in finding jobs (and) eliminate unjustified restrictions and discrimination that undermine equal employment”.
Closing the wealth gap in China, where the top 1 per cent holds more wealth than half of the population, has been a key theme under Mr Xi’s leadership, particularly after the party’s centenary celebration on July 1, 2021.
He announced then that China had progressed to become a “moderately prosperous” - or xiaokang - society, five months after he declared in February that the country had eliminated abject poverty.
In his work report speech on Sunday, Mr Xi ticked off China’s economic achievements over the past decade, such as increasing its gross domestic product (GDP) to 114 trillion yuan (S$22.6 trillion) in 2021 from 54 trillion yuan. Its per capita GDP has also risen from 39,800 yuan to 81,000 yuan.
In a brief acknowledgement to the country’s future economic challenges, Mr Xi said China will implement a national strategy on boosting childbirth, without providing further details.
China is widely expected to miss its growth target of “around 5.5 per cent”, with the World Bank forecasting a growth of 2.8 per cent for the whole of 2022.
In the first half of 2022, China’s economy grew by a paltry 2.5 per cent - dragged down by Covid-19 lockdowns in rich cities Shanghai, Shenzhen and Beijing, and a deep slump in its formerly booming property market.
Mr Xi highlighted on Sunday that development is the party’s top priority in governance, urging the country to focus on high-quality development and expand domestic demand, though he did not address specifically the damage done to the economy due to the strict Covid-19 policies.
Analysts told The Straits Times that China has yet to demonstrate its commitment to improve the dour job market and take concrete measures to promote common prosperity, due to its heavy focus on fighting Covid-19.
Dr Iris Pang, chief economist for Greater China at ING Group in Hong Kong, said: “Job stability is a result of economic strength, which is complicated at the moment, with Covid-19 and the real estate crisis overlapping each other”.
But China’s actions so far - including Mr Xi’s defence of the zero-Covid policy in his speech on Sunday - have pointed to a continued doubling down on outbreaks, she added.
Mr Xi said China has won international praise for its approach towards the pandemic, adding that it has put the people and their lives first and achieved “significant positive results” in coordinating epidemic prevention and control.
Mr Bo Zhengyuan, a partner at Plenum consultancy in Shanghai, said: “We have still not seen concrete measures for the common prosperity drive, (though) the recent Covid-19 outbreaks and economic downturn may have stalled implementation.”
But economics professor Yuan Gangming at Tsinghua University said the language used in the latest work report for market reform is stronger than previous ones.
For example, Mr Xi called on the party to “give full play to the decisive role of the market in the allocation of resources”. The words “full play” were not included in previous work reports.
The People’s Bank of China said in a report on Oct 9 that its employment sentiment index, which measures depositors’ outlook on jobs, declined to 35.4 in the third quarter of 2022, the lowest level since the collection of data started in 2010.
A figure below 50 represents a contraction in the sector.
Some 45.2 per cent of those polled said that finding a job was tough or “hard to judge”, and only 9.7 per cent said it was easy to get a job.
The central bank surveys 20,000 depositors across China every three months.