Chinese migrant workers rest at a gas station after riding motorcycles January 25, 2019 in Zhaoqing, Guangdong province, China.
Wang He | Getty Images News | Getty Images
BEIJING – After years of trying to settle in cities, Chinese migrant workers are returning home.
An aging population, a high cost of living, and new businesses like live e-commerce are all contributing to the reversal of the rush to big cities that has defined China’s economic expansion in recent decades.
Millions of Chinese have not returned to work in urban areas after the coronavirus pandemic last year, official data shows. At the end of March, the statistics office said there were still 2.46 million fewer migrant workers than at the same time in 2019.
“Rural-to-urban migration has already slowed before covid and experienced its first decline in 2020,” said Dan Wang, Shanghai-based chief economist at Hang Seng China.
“Reverse migration will accelerate in the years to come, in part because [the workers] cannot afford housing in the city and do not have access to city health care, ”Wang said. A major factor she highlighted is aging – the share of migrant workers over 50 has more than doubled in the past 12 years to 26%.
Already, data shows that instead of going to the biggest Chinese cities like Beijing or Shanghai, more migrant workers are stay closer to home, in the same province.
Government policy has also contributed to this trend.
As the state has loosened its grip on the economy in recent decades, tens of millions of Chinese have sought employment in major cities like Beijing and Shenzhen. Local governments have built subways and other urban infrastructure to support growth.
However, many migrants have faced difficult working conditions as factory workers or, more recently, couriers for China’s e-commerce giants. A strict residency system – called “hukou” – prevented migrants from accessing public health care and schools, or buying property in their working town. The influx of people has helped to deplete local resources, prompting authorities to deport the migrants.
Smaller cities like Xi’an have tried to attract highly skilled or educated workers by offering perks such as residency status.
China has tried other types of urbanization – building infrastructure in rural areas. These efforts have contributed to Beijing’s goal of reducing extreme poverty, a commitment the government said it kept last year.
Official figures showed that last year 1.6 million more people than in 2019 returned to the campaign to start businesses, aided by grants. A little more than half of entrepreneurial projects focused on using live streaming and other online methods to sell products, according to an official report.
Many people outside of big cities are employed in this so-called digital economy, as they can work remotely for companies that may still be based in urban city centers.
Qingtuanshe, a job search platform within the Alipay mobile app, said that in the past year, there has been a significant increase in posts for live broadcast hosts and jobs. related. The company added that the share of workers for these jobs in level three and four cities has increased.
And among the multitude of small businesses that have sprung up in the industry, Beijing-based public relations firm Vyoung says it gets calls from 20 to 30 people a day – increasingly from small towns – to discuss influential partnerships with major fashion brands.
Reports from government agencies indicate that the digital economy has grown to contribute more than a third of total GDP, while more than 50 million people in rural areas became internet users last year. .
Although it is not easier for newcomers to the live streaming industry to become stars, the market needs more influencers in the “middle” segment, said Jialu Shan, economist and specialist. Asian and Emerging Markets at the International Institute for Management Development..
The explosive growth of live streaming over the past year has been accompanied by numerous complaints about counterfeit products and a high return rate, Shan said. She expects that the industry can now evolve to a healthier state, while also providing untapped opportunities in niche areas such as services.
Greater economic challenges
However, it is still unclear to what extent the digital economy can contribute to growth. Retail sales have has grown more slowly than expected and the share of online sales has stagnated – a concern for an economy that is trying to rely more on individual consumption.
In the first quarter, consumer optimism rose across income levels, but a measure of spending growth remained subdued, according to a survey by Ant Group and Southwestern University’s Center for Household Finance of Finance and Economics.
In high-value tech industries like semiconductors, Chinese executives have warned of a talent shortage, and China’s top Tsinghua University even launched a college in April to focus on chips.
The labor shortage means that at the moment there is a defined pool of high-tech talent who “just want to bypass several companies in particular,” said Yin Zheng, product marketing manager at Moka, a human resources company focused on recruitment. The company said its corporate clients were mostly large corporations and large technology companies.
For the majority of less educated workers, moving to smaller towns or returning to the countryside can lower the cost of living. But wages are lower, which contributes to growing income inequality in China.
Analysts at Chinese investment bank CICC said in a report this month that in the low-end job market, the unemployment rate and job search rate have increased since the pandemic, reflecting a disconnect between employers and workers.
Official data showed that while the unemployment rate – based on a survey of urban residents alone – was below 5% in May, cities had created 230,000 fewer jobs for the year so far compared to the same period in 2020.
The statistics office did not provide updated figures on migrant workers at its last press conference this month.