Chinese youth, in their 20s and 30s, are spending less and saving more cash since the country is doing bad on almost all economic parameters
Contracting economy, lesser jobs, pay-cuts for those who at least have one and contraction of retail since zero Covid policy is in force is the new Chinese reality. AFP
New Delhi: No more manicures, no movie outings, no new cars or new houses, no new nothing: Chinese youth are a dejected lot trying to save whatever they can, rather than splurge. Contracting economy, lesser jobs, pay-cuts for those who at least have one and contraction of retail since zero Covid policy is in force is the new Chinese reality.
Most interesting or indicative is that social media influencers have sharing posts teaching ways to cut down expenditure, to live frugal and how to save.
According to a Reuters report, Chinese youth, in their 20s and 30s, are spending less and saving more cash since the country is doing bad on almost all economic parameters.
“We’ve been mapping consumer behaviour here for 16 years and in all of that time this is the most concerned that I’ve seen young consumers,” Reuters quoted Benjamin Cavender, managing director of China Market Research Group (CMR).
Unemployment among people aged 16 to 24 stood at a record high of 20 per cent in July this year, according to government data cited by Reuters. The report said that young people have had to forego big chunks of their salaries in the retail and e-commerce sectors.
The Reuters report also flagged that the average salary in 38 major Chinese cities had witnessed a downwards slide.
“Almost 60 per cent of people are now inclined to save more, rather than consume or invest more, according to the most recent quarterly survey by the People’s Bank of China (PBOC), China’s central bank. That figure was 45 per cent three years ago,” the Reuters report said.
As an evidence of the trend, the Reuters report cited the sharp rise in savings accounts of the Chinese. “Chinese households overall added 10.8 trillion yuan (US$1.54 trillion) in new bank savings in the first eight months of the year, up from 6.4 trillion yuan in the same period last year,” the report said.
Moreover, China cut interest rates this year to boost growth and spending, and conversely state-owned banks cut personal deposit rates to discourage people from saving to boost consumption.
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