China's Painful Economic Woes

The chances of finding a job is harder with more people out of work

The New York Times recently reported how the economic slowdown in China is affecting its workers and it's very worrying.

It's not just the factory workers and construction workers who are hurting -- it's also the white-collar ones with university degrees, making them wonder how stable their futures are.

There are fewer jobs available, some companies reporting layoffs of up to 30 percent in firms that employ hundreds of people, while jobs ads across all sectors have dropped by 10 percent. Start-ups have had it the hardest with new positions falling 51 percent in the third quarter of 2018 from a year earlier.

Not just factory workers, but white-collar ones are laid off too

Just after Spring Festival in February, Didi Chuxing, China's largest ride-sharing and taxi-hailing service, told employees that it would cut 2,000 jobs, or 15 percent of its workforce.

Previously the Chinese government would create an economic stimulus by throwing money at infrastructure projects like bridges and airports, and that would generally solve the problem, but not anymore.

Fraser Howie, co-writer of three books on the Chinese financial system says now, "there is no obvious catch up, and therefore it makes it all the more important that China makes important, difficult decisions to move forward."

The government really should be restructuring its state-owned enterprises that have grown into lumbering behemoths but they are the elephants in the room that aren't being addressed. Instead the government is in denial and hoping things shall pass, but perhaps not this time.

The economic slowdown is impacting young professionals like Sherry Xu, a 34-year-old finance professional who did all the right things, studying at a prestigious university and then rising up the ranks of the finance industry.

Infrastructure projects aren't solving China's economic issues

And then recently, right after she had just pitched a group of potential investors Xu was called into a meeting with human resources who told her that her employer, a financial firm was having difficulties and she would be laid off.

Xu then accepted a job as a freelance contractor with the same firm for half her previous salary. "The job marketing isn't looking good. I feel this time, it will be harder than ever for me to find a job."

Not only that but people's budgets have tightened which means less disposable income for shopping, dining and travel.

Maybe it's because of this worrying sentiment that the government just announced on Friday the May Day holiday would be extended to four days instead of one in a desperate bid to stimulate the economy.

But really, who is in the mood to spend when their futures are uncertain?

App for Paid Coverage

A screen grab showing the various jobs on offer

There's car hailing apps in China like Uber and Didi Chuxing that help you get to where you want to go, but what if you want a reporter to write a flattering story about your company, perhaps because your boss wants to inflate his ego, or a way to boost your stock price?

Then it's time to get onto the app Zhao Jizhe (找记者) -- "Find a Journalist" in Chinese.

Much like those car-hailing apps, Zhao Jizhe offers services to companies who are willing to pay a range of prices for media coverage. For as little as 1,000 yuan (around US$150), you can get a decent write-up in one publication. But shell out 8,000 yuan, and the article will be written by a senior writer and guaranteed coverage in 25 publications, including four well-known ones.

First companies post their demands and deadline, and then the journalists who fit the bill will bid for the job, touting which publications they can place the article in. Then the company picks the best person for the job and then arranges payment through the app.

This is very similar to the old school way of doing journalism in China -- with red envelopes.

At press conferences, companies would hand out hongbao in the hopes they'd get good reports from journalists.

Hardly anyone refused these red envelopes because hey -- it's cash! And companies would claim it was "transportation money" for the reporters to get to and from the press conference or event. The amount could range from a few hundred yuan to several thousand, depending on the firm. The higher paying companies were usually car or oil industry related...

This would seriously affect not only the quality of journalism, but also the readers' perception of the companies they were reading about. Perhaps paid journalism is how some stock prices went up? Someone should do a study on that.

In any event Zhao Jizhe is very much on the same lines, though the high-tech version.

Unfortunately journalists in China are paid so little, that the money is very tempting. We all need to make a living, right?

But then again who believes what's written in state media anyway?