In the face of an unprecedented unemployment crisis, China has turned to the revival of the street-stall economy as a potential solution. Megacities like Beijing and Shanghai are relaxing regulations to allow street vendors to operate in more public areas, signalling a shift in the government’s approach to combating the alarming situation.
Since the post-COVID era began, the Chinese economy has struggled to regain its pre-pandemic strength, resulting in a sharp rise in youth unemployment. Even college graduates cannot secure stable employment, exacerbating the issue further.
State authorities have drawn parallels between the current plight of unemployed graduates and the characters from Kyong Yiji literature, urging them to “take off the long gown” and embrace entrepreneurship by setting up street stalls. This comparison has only fueled the growing discontent among jobless graduates, many of whom have adopted a passive approach, colloquially referred to as “lying flat,” causing concerns among the authorities.
Ironically, many of these graduates, unable to find suitable employment, have resorted to establishing their own street stalls. However, the financial prospects of such endeavours remain limited. On average, street vendors can expect to earn a maximum of 500 Yuan per night, a sum further reduced by expenses such as booth fees. As a result, they are left with meagre savings of around 200 Yuan.
The re-emergence of the street-stall economy represents both a temporary lifeline for unemployed graduates and a broader symptom of the challenges faced by China’s labour market. The government’s move to relax regulations and embrace this informal sector may provide some relief. Still, a sustainable solution to the unemployment crisis necessitates comprehensive reforms and support for job creation across various industries.
The street-stall economy initiative was initially proposed by the former Premier of the Communist Party of China, Li Keqiang, in May 2020, as a means to stimulate the economy and alleviate the severe unemployment crisis plaguing various parts of China. However, despite the end of the Zero-Covid policy, the economy failed to recover to its pre-pandemic levels. Weak consumption, driven by a sluggish housing market, a fragile labour market, and rising household debt, coupled with the political tensions between the United States and China, resulted in a flight of foreign capital and eroded confidence in the economy.
One remarkable aspect of the street-stall economy is that it is predominantly run by unemployed college graduates rather than middle-aged or older individuals. These graduates utilise social platforms to expand their reach and share information regarding stall locations, categories, and experiences.
The Chinese Communist Party (CCP) views this phenomenon with unease, as it recognises that the issue extends beyond mere economics and possesses socio-political implications that could potentially harm its reputation and have far-reaching consequences in the future.
In response to this setback, the CCP has manipulated the unemployment data released by the National Statistics Department. Meanwhile, state-owned enterprises actively cooperate in this falsification, working in tandem with the propaganda machinery to portray the street-vending occupation as a valuable endeavour for young white-collar workers. This narrative emphasises the transformation of these workers from high-rise office buildings during the day to small street-side stalls at night.
The contradictory data is indicative of this manipulation, as the unemployment rate in May reached a staggering high of 20.8%, while the number of graduates entering the labour force simultaneously rose to a record 11.6 million. As the CCP cracks down on private enterprises that traditionally employ graduates, such as in the fields of information technology, education, and real estate, Chinese youth find themselves with limited options. They are left searching for employment each day, investing countless hours in skill-enhancing classes, only to find their efforts yield no tangible results. The policy missteps of the CCP have left the Chinese youth facing a bleak future, with little hope of escaping the vicious cycle perpetuated by an education system that offers them limited opportunities for leading fulfilling lives.