The unemployment rate among young people in China has reached a new record level. According to Sky News, the unemployment rate among youth in China rose to 20.8% in May, marking a new record in the world’s second-largest economy.
The National Bureau of Statistics in China stated on Thursday that their data indicates a continuous rise in youth unemployment in urban areas over the past few months, reaching 20.8% last month. This rate was 20.4% in April.
As for the overall unemployment rate, it remained at 5.2% in May, the same level as in April, according to the same source.
The new record level of youth unemployment, along with a series of disappointing economic indicators in China, released on Thursday, indicates a faltering recovery in the country. This has prompted some economists to call for an adoption of a stimulus plan.
The long-awaited recovery, following the lifting of health restrictions imposed to curb the spread of COVID-19 at the end of 2022, seems to be weakening in the past few weeks in the world’s second-largest economy, with no visible effects in some sectors.
According to the released data, retail sales, a key indicator of household consumption, experienced a setback in May.
The markets closely monitor this indicator, which increased by 12.7% on a yearly basis last month, but at a slower pace than in April (18.4%).
Analysts surveyed by Bloomberg Financial News agency expressed their expectations for a more moderate slowdown (13.7%), despite the return of customers to shopping centers and restaurants since the lifting of health restrictions in December.
Industrial production growth slowed down to 3.5% on a yearly basis in May, compared to 5.6% in the previous month when factories gradually resumed their operations at full capacity.
Fixed asset investment also slowed down, recording a 4% increase on a yearly basis during the first five months of the year (compared to 4.7% previously).
This is an indicator of spending on real estate, infrastructure, equipment, and machinery, which are sectors relied upon by the government to stimulate economic activity.
The authorities aim to achieve a growth rate of “around 5%” this year, which would be one of the lowest in decades for the giant Asian country. In order to support growth, the People’s Bank of China reduced the benchmark interest rate for medium-term loans on Thursday.
