'Social unrest' grows as Chinese economy slows
As strikes and job losses mount, the slowdown in China's economy may be less benign than its leaders admit
Source: National Bureau of Statistics. China Federation of Logistics and Purchasing, China Labour Bulletin
Outlook
A marked deterioration of the job market and a rise in labour unrest raise questions about leaders' claims that a slowdown in economic growth is a harmless and intentional 'new normal'. The near-term priority will be to keep unemployment and labour unrest at manageable levels This, rather than a 'red line' GDP growth target, may be what determines how much of a slowdown is tolerated before heavy stimulus measures are launched. For now, though, living standards are probably still rising for most people, while unrest seems far from reaching a level that the 'social management' system cannot comfortably contain.
Impacts
- Reports from the front line of local government may force or stay the central government's hand regarding stimulus measures.
- Some dislocation is inevitable as rebalancing of the economy takes place, but dislocation does not always imply rebalancing.
- The government sees repression of labour unrest as a short-term fix, and economic development as the strongest basis of state security.