A job crisis in China? Chief Regulator Says Technology Thrives

In a rare top government agency’s direct response to concerns about a jobs crisis, China’s Cyberspace Administration said on Friday that the country’s 12 tech giants have hired more workers than they’ve lost in the past nine months. He cited the recent “heated public discussion” of reports of “mass layoffs” at major internet companies.

CAC stated that recently talked to leading technology companies such as Alibaba (WOMAN), tencent (CEGI), JD.com (JD), Pingduoduo (SDA), and a group of ants. In these companies, 216,800 people left their jobs between July and mid-March, and 295,900 people were hired during the same period, the study found.

“Total employment in companies is steadily increasing,” the CAC said in a statement. They have recorded strong growth in some new businesses, and their revenues have “repeatedly hit new highs,” he added.

“They are full of confidence in the future development,” said the CAC.

The CAC statement paints a more optimistic picture than recent earnings reports from some of these companies, as well as comments from other government officials about the state of the labor market in general. It also contrasts with the reluctance of tech companies themselves to respond to reports of job cuts.
In recent weeks, the international media informed that China’s tech sector has seen its biggest job loss since the government launched crackdowns in late 2020 to rein in its most powerful companies.

The once free industry has long been China’s main source of well-paid employment, but companies like Alibaba and Tencent are reportedly preparing to lay off tens of thousands of employees to cut operating costs. Both repeatedly declined to comment.

Some of the biggest players in Chinese tech are Alibaba, Tencent, and Pinduoduo. they all reported the slowest earnings growth ever, and their share prices have halved since the start of the regulatory crackdown.
Private job surveys also show that jobs are shrinking in the economy, and in particular in technology. Analysts predict that job losses are likely to worsen because the downturn in the tech sector comes at the same time as a crisis in real estate and related sectors, which account for about 30% of China’s GDP.

However, while the CAC sounds optimistic about high-tech jobs, other senior government officials paint a much bleaker picture of the labor market.

Hu Chunhua, Vice Premier of China, on Friday called for a “universal effort” to stabilize employment.
“Due to the Covid outbreak and other factors, the employment situation is difficult and difficult right now,” Hu told representatives of companies and government departments. state Xinhua.

He urged executives to stabilize and expand employment, and officials should address the problems faced by businesses in a timely manner.

Just a few days earlier, Premier Li Keqiang stressed the importance of maintaining stable employment and helping small businesses through difficult times.

Lockdowns in Shanghai and other Chinese cities pose a growing threat to the economy.

The economy is facing “new downward pressure” amid new Covid outbreaks and rising global food and commodity prices, Li said at a key government meeting last Wednesday.

“Some businesses have been hit hard and some have even shut down production or closed businesses,” he said. “We must step up rescue efforts and provide job security in response to their hardships.”

The Chinese government has set a 5.5% GDP growth target for 2022. But the World Bank and some investment banks have recently warned that the damage done to China’s economy by the zero coronavirus policy is growing.

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