China jobs: suspended production, extended unpaid leave embody woes with private businesses under pressure
- On paper, China’s urban surveyed jobless rate has stabilised over the past few months, but pressure persists to maintain jobs for small and medium-sized firms
- The private sector, long the backbone of China’s economic growth and job creation, is struggling and staff are being asked to take extended periods of unpaid leave
Overwhelmed by an ongoing real estate crisis, a privately run aluminium producer in China’s southern manufacturing hub of Guangdong has forced staff to take five months of leave on reduced salaries, shining a light on potential unemployment problems for the world’s second-largest economy.
China’s economy disappointed on many fronts in 2023, defying support measures and dampening its prospects, with the weakness putting pressure on employment, which has long been a priority for Beijing to create enough jobs to ensure economic and social stability.
We can’t find the owner
But there are worrisome signs that some companies have implemented months of unpaid leave or reductions amid a depressed market situation, and analysts have called for more policy support to revive domestic demand and stabilise manufacturing production.
With production suspended, staff who opt to remain employed by Golden World Innovation Aluminum have been told they will only receive 80 per cent of the minimum monthly salary of 1,900 yuan (US$266) allowed under the labour laws in Foshan, representing a third or less of their regular income, until the start of April.
“We can’t find the owner,” said a 50-year-old migrant worker surnamed Tong from the neighbouring Guangxi province, who has been working for the factory for nearly 10 years but has not been paid since September.
Golden World Innovation Aluminum did not respond to requests for comment.