What happened
China’s Unemployment Rate for youth aged 16-24 has surpassed 20%, according to the country’s National Bureau of Statistics, setting a precedent. This makes for the highest percentage in recent records.
China’s young are challenging the previous status quo with drastic shifts in motivation, desired lifestyles and values. Rising unemployment can be linked to post pandemic economic uncertainty but also many young people’s rejection of China’s brutal and competitive “996” lifestyle (9am-9pm work days, six days a week) popularized in the last few decades within the country’s tech boom.
The Jing Take
So should aspirational and luxury brands be worried? It depends on the target demographic and how well brands can speak to the new lifestyles, values and aspirations of China’s young. With rising joblessness comes less disposable income, but there are also cultural factors to consider.
Jing Daily has been covering the dramatic rise of popular terms like “lying flat” 躺平” and “letting it rot” 摆烂 in the Millennial and Gen Z lexicon. The struggle for work-life balance amongst the young can be coupled with personal despair or hopelessness at their situation. But despite rising interest in these rather negative terms, the attitude doesn’t yet reflect the mainstream.
Unfavorable factors contributing to a worse off employment environment for younger workers will include a lack of workplace experience, insufficient professional skills, pandemic fallout and low starting salaries. Additionally, new technologies being adopted rapidly in China has also caused gradual shrinkage of some traditional occupations, while those that command this tech are generally higher level professionals, using specialized skills and more innovative thinking.
With 2023’s general lifestyle trends and aspirations moving towards wellness, health, and simplification of life, and a rising number of Chinese youngsters are embracing the “less is more” mentality.
Eagerness to holiday in relaxed, nature-filled Yunnan Province or live in the laid back city of Chengdu (China’s new luxury capital), will signal a move for brands in terms of retail, geographic focus and luxury engagement. Those that can pre-empt or respond quickly to these new trends have a huge advantage with Gen Z.
However, a 20.4% unemployment rate for 16-24 year olds does give cause for some concern. This figure is from 2023’s April stats, which rose from March’s 19.6%. Zhang Zhiwei, chief economist at Pinpoint Asset Management, called it a “worrying sign”, according to the South China Morning Post, but the central government has also made moves to address the issue.
It would not be within anyone’s interests if China’s youth “let it rot”, but if this trend continues, Gen Z-focused aspirational retail and commerce could likely suffer.
The Jing Take reports on a piece of the leading news and presents our editorial team’s analysis of the key implications for the luxury industry. In the recurring column, we analyze everything from product drops and mergers to heated debate sprouting on Chinese social media.