Chinese Factory Employment Shrank in April, Beige Book Says
Manufacturers saw workforces shrinking in April, according to a the results of a survey of 547 firms
(Bloomberg) -- The employment situation at Chinese factories worsened in April from the end of March, China Beige Book said, and the economy was on less solid ground than the official data shows.
Manufacturers saw workforces shrinking in April, according to a the results of a survey of 547 firms, with continued declines in both production and sales. Domestic and international demand is still weak, with the shutdowns in Europe and the U.S. wreaking havoc across China’s economy.
“Our deeper look at the crucial private sector, especially SMEs, shows critical metrics such as output, sales volumes, and hiring sliding even over a weak March,” said Leland Miller, CEO of China Beige Book.
The survey confirms the weak data seen in Bloomberg’s earliest indicators for China’s economy, which showed that the nascent rebound from the historic contraction in the first quarter was already losing pace. Purchasing managers at manufacturing firms were also less confident about the outlook this month, with data due Thursday expected to show the a drop to 51 from 52 in March.
While most Chinese companies have returned from the extended shutdown in February, even those that are back are not operating at normal capacity. About 91% of Chinese companies had resumed businesses by late April, according to the CBB survey, but only 4% were operating at full capacity.
Services firms have seen an increase in hiring, but the majority of surveyed firms see business conditions either staying the same or getting worse than today, with concerns about a second coronavirus outbreak dominating their fears.
“An improved but still very difficult April” is “as good as it gets over the next half year,” according to more than two-thirds of the firms.
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With assistance from Bloomberg