SCIO briefing on China's economic growth in the first three quarters of 2020
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E-mail China.org.cn, October 20, 2020
CNBC:
I have two questions. The first one is concerned with the employment of graduates and migrant workers. What is the employment situation in the hometowns of those migrant workers who did not choose to return to cities this year? The second question is on consumption. What is the future of e-commerce, after securing rapid growth this year, when its proportion has undergone fewer volatilities than others?
Liu Aihua:
Thank you for your questions. The first one involves the employment status of graduates from institutes of higher education as well as migrant workers. Based on the data, the pressure to ensure fresh graduates' employment has been relieved since September, and the job market has gained good momentum. The pandemic earlier this year has negatively impacted the employment prospects of graduates. However, the turning point appeared in September when the graduation season came to an end, and the employment rate showed robust signs of recovery. In September, the unemployment rate observed for graduates aged 20 - 24 from junior college and above dropped by 2.4 percentage points. Concerning the employment of migrant workers, there were 179 million migrant workers in the third quarter this year, an increase of 2 million compared with the second quarter, which indicates the growth of the migrant labor force. The unemployment rate in cities and towns among migrant workers has continued to decline each month, indicating a good momentum regarding employment in this particular sector.
However, it remains challenging to find employment this year. Despite the monthly drop of 2.4 percentage points of the unemployed graduates aged 20 - 24 from junior college and above in September, the rate remains 4 percentage points higher year on year, indicating a much-strained scene for this year's graduates. Meanwhile, despite the growth of the migrant labor force from the third quarter, employed laborers remained about 3.8 million less compared to last year, registering a year-on-year decline of 2.1%. That is why we need to reinforce the implementation of policies designed to protect market entities, assist enterprises in solving financial problems and stimulate flexible employment so that the employment of those targeted groups can be improved.
Your second question is on online consumption. Based on today's data, e-commerce retailers are growing against the trend. In the first three quarters, sales of physical commodities from those retailers jumped 15.3% year-on-year, accounting for 24.3% of the total sales. The growth compared to the 7.2% fall of the entire retail sector is both uneasy and remarkable to achieve. So the 24.3% proportion is a result of gradual growth. Generally speaking, e-commerce consumption has played a significant role in upholding people's livelihoods, maintaining economic growth and preventing and controlling the pandemic from further spreading. Thank you.
Market News International:
Could you please explain in detail how expenditure makes up the entire 1.7% consumption, including the capital formation？
Liu Aihua:
With this year's unique situation, a few contribution rates or three major points of demand turned negative. Therefore, we intended to release the data based on the points. During the first three quarters, the final consumption expenditure dropped by 2.5 percentage points; however, the aggregation of capital formation was up 3.1 percentage points. The net export of both commodities and services was up 0.1 percentage points, registering a GDP growth of 0.7% year-on-year. However, the rates or points are more discernible when we take a closer look at each quarter. During the third quarter, the final consumption expenditure rose by 1.7 percentage points, the capital formation up 2.6 percentage points and the net export of commodities and services up 0.6 percentage points. Compared to the second quarter, the final consumption expenditure increased by 4 percentage points, shifting from minus 2.3 percentage points to 1.7 percentage points. The capital formation fell by 2.4 percentage points from 5 percentage points to 2.6 percentage points. The net export of commodities and services was almost even -- between 0.5 percentage points in the second quarter and 0.6 percentage points in the third quarter. The impact of the coronavirus pandemic at the demand end, especially consumption, was prone to a significant impact in the first quarter. Therefore, with changes in the general situation, especially that in the second and third quarters, the final consumption expenditure grew gradually while the capital formation started to fall, which combined indicate a growing contribution of domestic demand. Thank you.
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