Economic Watch: Coronavirus prompts more Chinese firms to embrace telework -- at least for now

0 Comment(s)Print E-mail Xinhua, February 5, 2020
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by Xinhua writers Zheng Xin and Han Xiao

BEIJING, Feb. 5 (Xinhua) -- More Chinese firms are asking employees to work from home using online toolkits to keep businesses running amid the coronavirus epidemic, catapulting players in the long-time niche market to stardom.

Data from Welink, a cloud service supplier affiliated with tech giant Huawei, showed that the average number of new enterprise users per day has increased by 50 percent in the past week. On Feb. 3, the first working day after a prolonged Spring Festival holiday, 120,000 meetings were conducted on the platform.

Explosive user growth even overwhelmed some online platforms on that day. Wechat Work, a Tecent app that comes with a wide array of built-in office automation tools, scrambled to repair network glitches and expand server capabilities as millions of users flooded in for its teleconference function. Over 10 million corporate users of Dingtalk, a similar platform of e-commerce giant Alibaba, triggered limits on data traffic, prompting Alibaba to beef up over 10,000 cloud computing servers to ensure stable video services.

Wechat Work said it saw the number of corporate users triple from the same period last year, while an engineer with DingTalk compared recent workload surge to that only seen during the Singles' Day shopping spree when concurrent orders were measured in millions.

Data from research firm EO Intelligence showed that a total of 17 companies now offer users free access to 21 online working products, most of which are instant messaging applications.

To curb human-to-human transmission of the highly-contagious novel coronavirus, Chinese authorities have asked enterprises to replan their business calendars for employees to come back later for in-house work and use telecommuting and video teleconferences instead.

A similar approach was adopted for the country's students. The Ministry of Education announced in late January that the beginning of the 2020 spring semester will be postponed, and online education activities would be encouraged.

More than 10,000 universities, primary and secondary schools, as well as their 5 million students, will attend classes via live broadcast on Dingtalk in its "home-turned classroom" initiative participated in by over 20 provincial-level regions.

A recent report on human resources policies amid the coronavirus outbreak by Deloitte Consulting showed that 67 percent of respondents cited providing employees with online working tools as the most needed action in supporting the workforce in the current state.

Skyrocketing demand for online workplace and education services resonated in the stock market. Shares in related sectors were among the top winners since the market reopened Monday, with many surging by the daily limit of 10 percent.

"Despite the current low penetration in China, working online has continued to grow, and there is still broad space and faster expansion ahead," said Zhang Xia, an analyst with China Merchants Securities (CMS). In comparison, a CMS research showed that over 80 percent of U.S. firms had introduced telework mechanisms by 2017, with up to 19 percent of the country's labor force working from home.

Relative fast growth was forecast for the market in China. According to the Shenzhen-based Qianzhan Industry Research Institute, China's mobile officing market was worth around 27.1 billion yuan (about 3.88 billion U.S. dollars) in 2019, and it is predicted to exceed 48 billion yuan in 2024.

Meanwhile, some analysts raised questions on the sustainability of the boom and how online platforms can replace real cubicles once China wins the battle against the epidemic.

In the short term, online workplace software companies can see a major boon to their businesses, but the outcome of online-versus-traditional officing will depend on the quality of the online services and whether companies really see the incentives to embrace the telework mode and shake up their company structure, according to a research note by brokerage firm Sinolink Securities.

The fact that internet companies themselves report the highest adoption rate of the work-from-home model also demonstrates the current limits of telework services. According to a report by leading job recruitment platform, businesses in the automobile, manufacturing and agriculture sectors turned out to be the least enthusiastic. Enditem

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