China touts fiscal, monetary policies to revive flagging economy

China will focus on creating jobs and promote fiscal, monetary and industrial policies to stabilise its labour market, a top official has said.

China’s economy has struggled to rebound from lockdowns and slowing global growth, with the youth unemployment rate surging to a record high of 19.9 percent in July. Unemployment insurance payouts hit an all-time high in June.

China’s employment situation has remained generally stable for a long time, but there has been persisting long-term pressure, Li Zhong, vice minister of human resources and social security, said on Thursday.

“Structural contradictions have become more prominent with rising uncertainties and unstable factors. The job, employment, work still faces big challenges,” he said during a news conference.

The world’s second-biggest economy was affected by extended COVID-19 lockdowns in spring, which disrupted factory output and supply chains and hurt job-creating small businesses. The private sector provides a third of all jobs in China and creates 90 percent of new urban jobs, state media have reported.

“Amid sporadic COVID-19 outbreaks in some regions since the beginning of this year, job demand in the market has reduced and some recruitment campaigns have been cancelled or delayed,” Zhang Ying, director of employment promotion at the ministry, said at the same news conference.

“Some young job hunters have encountered new difficulties.”

China will focus on helping college graduates and migrant workers get jobs in the next step.

To prop up the economy, China added 19 new policies on top of existing measures, including raising the quota on policy financing tools by 300 billion yuan ($43.69bn), state media cited the cabinet as saying after a regular meeting chaired by Premier Li Keqiang on Wednesday.

Authorities will take “timely and decisive measures, maintain a reasonable policy scale and make good use of policy tools in the toolkit, and intensify efforts to consolidate the foundation for economic recovery,” the cabinet added.