China’s factory, consumer activity weakens in May, youth unemployment rises
BEIJING (AP) — China’s consumer and factory activity weakened in May and record-breaking unemployment among young people in cities rose as an economic rebound following the end of anti-virus controls slowed.
Surveys found 20.8% of potential workers in cities aged 16-24 were unemployed, up from April’s previous record of 20.4%, the government reported Thursday.
China’s economic activity rebounded after the ruling Communist Party in December lifted controls that cut off access to major cities for weeks at a time and blocked most international travel. But consumers, uneasy about possible job losses, returned to shops and restaurants less quickly than expected.
“The foundation for the economic recovery is not yet solid,” the National Bureau of Statistics said in a report.
Economic growth accelerated to 4.5% over a year earlier in the three months ending in March from the previous quarter’s 2.9%. Growth will have to accelerate in coming quarters to hit the ruling party’s annual target of “around 5%.”
“The data published today suggest that the reopening recovery had largely fizzled out by May,” Julian Evans-Pritchard of Capital Economics said in a report. “The economy appears to have lost some further momentum during the first half of June, too.”
Retail sales rose 12.7% over a year earlier, but that was down from April’s 18.4%, which was barely half the rate expected by forecasters. Growth in factory output decelerated to 3.5% from the previous month’s 5.6% after interest rate hikes in the United States and Europe to cool inflation depressed demand for Chinese exports.
The youth unemployment figure represents about 6 million jobless people out of a pool of 33 million people aged 16-24 who want to work, according to the NBS spokesman, Fu Linghui.
“The employment pressure of young people is still significant,” Fu said. He said there was a mismatch between job seekers and the skills wanted by employers, leading to a “shortage of highly skilled talents.”
May exports, reported earlier, tumbled 7.5% from a year earlier, reversing from the previous month’s 8.5% growth and adding to pressure on China’s factory workforce. An official survey of manufacturers found production, exports, new orders and employment declined.