Experts warn that China's stimulus policies might not be enough to boost job growth in the country. However, its annual growth has been between three to four percent. It has been lodged with three trillion yuan as an additional job-focused stimulus. They also claimed that its economy continues to struggle and recover from the adverse effects of the pandemic.
According to a professor at Tsinghua University and former adviser to China's central bank David Li Daokui, China has been planning to keep its unemployment rates steady at about six percent this year. He suggested that the government needs to improve its stimulus efforts to achieve the goal and maintain steady job growth. During an online seminar last Tuesday, he claimed that at least 10 million jobs must be created to keep China's unemployment rate steady in 2020.
Tsinghua University researchers led by Li published a report last month. In the report, it was indicated that China needs to achieve an employment growth rate between three to four percent this year. It was also suggested that a three trillion yuan job-focused stimulus must be offered to create these jobs.
Last Tuesday, however, a World Bank forecast manifested that China would fall short of its targeted growth rate. The report claimed that the country only expanded by one percent this year - its slowest in the past four decades. The economy is also currently experiencing weakened global demand and suffers from insufficient funding for domestic companies. These factors were perceived to weigh heavily on its growth initiatives.
In May, Beijing announced that it would implement a fiscal stimulus program that would focus on new infrastructure construction that would support its economic and employment growth.
The implementation expanded the central government's fiscal deficit target by 3.6 percent of its gross domestic product (GDP). The said value was its highest level in a decade as the government significantly increased its borrowing capacities to a record high. The latter initiative was supposed to stabilize the country's economy that contracted by 6.8 percent during the first quarter of 2020.
Li further added that the central government's stimulus had been smaller than anticipated, as suggested by their study. The researchers suggested that China needs to focus on boosting consumption and implement associated employment benefits for its constituents. They added that Beijing should also promote car and property sales to aid in faster economic growth.
Experts also claimed that China's economy dropped by 3.3 percent in US dollar terms compared to its 2019 values. Customs data released this weekend went back on its estimate that there has been a 3.5 percent rise in April.
