Coronavirus: China unemployment rate rose more than during US trade war

China’s unemployment rate jumped to 6.2 per cent for January and February from 5.2 per cent in December and 5.3 per cent a year earlier

The month-on-month increase is larger than the gain over the previous 18 months, but it does not include most migrant workers who have been hit hard by the outbreak

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China has already rolled out tax cuts and trillions of yuan worth emergency funds to help hard-hit small businesses, which employ the majority of China’s workforce. Photo: EPA-EFE

Published: 8:15pm, 16 Mar 2020Updated: 11:22pm, 16 Mar 2020

Unemployment in China rose at a faster pace in the first two months of 2020 while under pressure from the coronavirus outbreak than it did in the previous 18 months, when the economy was weighed down by the trade war with the United States.

China’s surveyed unemployment ratio, a key parameter used by Beijing’s policymakers to gauge the health of the economy, jumped to 6.2 per cent for January and February from 5.2 per cent in December and 5.3 per cent a year earlier, according to data released by the National Bureau of Statistics (NBS) on Monday.

The month-on-month increase is larger than the 0.3 percentage point gain over the previous 18 months, which included the height of the trade war with the US.

Beijing has yet to release an unemployment target for 2020 as the National People’s Congress has been delayed due to the coronavirus, having been initially scheduled for the first week of March, although the latest reading is above the 2019 target of “around 5.5 per cent”.

The rate is the highest on record, although the unemployment survey has only been published since 2016. It also combines January and February data to smooth out the impact of the Lunar New Year holiday, which occurs over different dates each year.

Stable employment has long been a top priority to ensure social stability, and as its annual economic planning conference in December, China’s top leadership pledged that “there will be no families in which all members are unemployed”.

Last week, Premier Li Keqiang reemphasised the commitment despite the possibility that China’s economy could contract in the first quarter of 2020 for the first time since the Cultural Revolution in 1976.