Customers look at 80 % or 70 % clothes advertising discounts in Hangzhou, Zhejiang Province, China, on June 9, 2025.
CFOTO | Future publishing Gety pictures
BEIJING – Consumer spending in China appears only a few signs of capturing soon, given the uncertainty about future wealth, changing preferences and the absence of a social safety net.
It was Four consecutive months of consumer low pricesConsumer confidence hovers near its lowest historical levels, and fights the real estate market for circumvention. Analysts repeatedly refer to one major factor: stagnant income.
Jeremy Stevens, a Beijing -based Asia economist at Standard Bank, said in a report on Wednesday that the income available in China has taken revenge on half of the growth since it reached the epidemic in 2020, as it now grows by only 5 % a year.
Most jobs do not give much increase. Of the 16 sectors, only three of the mining, facilities and information technology services – wage growth that exceeded GDP since 2020.
The monthly business surveys of May showed Rausing in the labor market In all fields, especially since factories transfer American definitions. The unemployment rate among young people between the ages of 16 and 24 remained and not in school in April 15.8 %. The unemployed rate of official work in cities is about 5 %.
One of the Chinese families of 64 % of Chinese families said in the third quarter of 2024 that they prefer to save money instead of spending or investing it, according to a quarterly survey conducted by the Chinese People’s Bank.
While this supervision of 61.4 % in the fourth quarter, according to the last survey issued in March, it reflects a direction of more than 60 % of the respondents prefer to provide this since late 2023.
For respondents who planned to increase spending, Education was the upper categoryFollowed by health care and tourism, according to the 4th quarter of PBOC scanned in March.
More than half of the respondents considered that the labor market has become more difficult or difficult to determine.
People in China were culturally tending to savings, especially since limited insurance coverage means that individuals should bear most of the cost of hospital treatment, higher education and retirement. The real estate recession in the past few years has also been weighed on spending because property accounts represent most of the family’s wealth in China.
One way to make people more willing to spend is more than just pension batches, by increasing the portfolio of government assets paid to the Ministry of Finance.
He added that increasing public holidays and providing the service consumption vouchers can also help.
In the past few weeks, the Chinese authorities have climbed with plans More employment support and Improving social welfare. But politicians have avoided the collective cash bulletins granted by the United States and Hong Kong to stimulate spending after the epidemic.
When leaving the epidemic, analysts warned that China’s retail sales will recover very slowly The main uncertainty of consumers remained without a solution.
In the precedent of the epidemic, “Chinese consumers were ready and able to buy any innovation, and even innovations that were not really innovations,” said Bruno Lanes, a great partner in Shanghai with Bain & Companyi products for consumers and retail practices.
“In today’s world they are more rational. They know what they want,” he said at an online symposium on Thursday.
China is scheduled to report retail sales in May on Monday. Reuters analysts expect a slowdown to 4.9 % growth year, a decrease from 5.1 % in April.
Shift
Another factor behind the readings of the negative consumer price index is that Chinese consumers resort to low -priced products, either partially benefit from relatively high -quality commodity production, or move away from large cities to places where the cost of living is lower.
Shanghai lost 72,000 permanent population last year, while Beijing witnessed 26,000 declines, and WorldPanel and Bain & Compa in a report on Thursday indicated. The two cities are usually classified as “Level 1” cities in China.
The report said that the smaller cities that were classified as “Level 3” and “Level 4” as a result of the population transformation, as it witnessed a much higher growth in the size and value of the daily necessities sold last year – and it helps to compensate for a decrease in the cities of the first level. The study covered packing food, drinks, personal care and home care.
It found that although the total volume of such goods sold in China increased by 4.4 % last year, the average selling prices decreased by 3.4 %, as consumers preferred low -price products and companies to increase promotion.
The trend until it affects flower sales.
In May, the Kunming International Auction Center in Yunnan Province, the largest flower market in Asia, said in May that more demand comes from low -grade cities, which leads to high sizes but average selling prices.
Shingwan, a flower seller near the trading center, said on Friday that the works were calmed after the crowded holiday season in May. She said that the prices of flowers had decreased a little, partly because more people were growing flowers. She expects the request to pick up the National Day holiday in early October.
In order to feel the disparity, the rural income available for the individual was less than half of the cities for years, according to official data. Last year, the individual’s income in urban areas was 54,188 yuan ($ 7553). This is much lower than 64,474 dollars were reported to the United States As of December.
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Stevens of Standard Bank indicated that the consumption rate to income in rural areas “increased significantly” and outperformed the levels of prenatal, while the percentage of urban families decreased. But he pointed out that low -income families do not have the size of the wealth carried out by the higher income groups in order to increase consumption in the short term.
He said that the best 20 % account for half of the total income and consumption in China, and 60 % of the total savings. “Policy support for low -income groups, despite goodwill, is insufficient without repairing structural wages.”
In addition, the speech “Joint prosperity” in China was introduced “institutional reorganization and transformations in politics, despite the goodwill, it added to uncertainty,” Stevens said, noting that the changes “did not completely find a new balance.”
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