© Reuters. Travellers wait for their trains at Shanghai Hongqiao railway station, during the Spring Festival travel rush ahead of the Chinese Lunar New Year, in Shanghai, China February 5, 2024. REUTERS/Nicoco Chan/File Photo
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By Nicoco Chan and Samuel Shen
SHANGHAI (Reuters) – Chinese workers packed into trains on Monday, heading home for the Lunar New Year holidays with worries about their jobs and a stuttering economy overshadowing the build-up to the long-awaited family reunions.
People are expected to make a record 9 billion journeys before and after the Feb. 10-17 break – usually a time for celebration and relaxation.
But this year, many said they were worried what they might find when, or even if, their employers call them back.
“Business was not very good,” said Wang Jinzhu, looking back at the past year at the electric toothbrush maker where he works. Sales were down 30% at the business that exports most of its products to the U.S. and Europe.
“I feel my days were tougher than in previous years… I think 2024 could be even harder,” the 42-year-old said before boarding a train in Shanghai to the central Henan province.
Many factories in China have been locked in a relentless price war for shrinking business as higher interest rates and rising protectionism abroad squeeze demand for their goods.
Producer prices have fallen for 15 straight months, crushing profit margins and endangering workers’ incomes and jobs, adding another major headache for the world’s second-largest economy, already reeling from a property crisis and a debt crunch.
China’s economy grew 5.2% last year. But for many – including unemployed graduates, property owners who feel poorer as their flats lost value and the workers earning less that a year ago – it felt like it was shrinking.
Nie Yating, who has worked in a Shanghai pet hospital for the past six months, said many of her colleagues saw their monthly pay drop by at least 1,000 yuan ($139) as the business continued to struggle to get back on its feet after the COVID lockdowns.
“The company had expanded quickly and then came the pandemic: they closed branches, fired staff and it’s affecting wages as well,” the 24-year-old said before her trip to her hometown of Anqing in the southwest.
In recent months, Chinese authorities have ramped up efforts to project confidence in the economy and calm nervy financial markets, with stocks lingering around five-year lows.
On Friday, a headline in the official Communist Party newspaper People’s Daily proclaimed: “The entire country is filled with optimism.”
But Wu Kan, who runs a small dredging business with six boats and a dozen workers, had little reason to feel confident about the rest of 2024.
Instead of travelling back home, he was heading to the eastern province of Shandong to try to collect overdue payments from clients. He has been paying his workers’ wages from his own pocket.
“Money is tight and the economy, post-COVID, feels in a bad shape. People are generally short of money,” Wu said.
“If I can’t collect the money I’m won’t be able to make any investments in the new year.” One option, he said, was to shut the business down.
($1 = 7.1984 Chinese yuan renminbi)
Source: Investing.com
