Confidence in the job market and incomes among Chinese plunged to new lows, while interest in buying homes also fell as an economic slowdown worsened this year, a People’s Bank of China report said on Tuesday.
The bank’s Employment Sentiment Index — which is based on a survey of households’ outlook for jobs — declined to 33.1 in the final three months of this year, worse than the prior quarter’s record low dating back to when data began in 2010.
Figures below 50 represent a contraction in the sector.
The Income Confidence Index — a gauge measuring expectations for income in the following three months — slid to 44.4, another record low dating back to 2001, the report said.
The report’s findings are based on a central bank survey of 20,000 depositors across the country, taken every quarter.
The survey underscored how much damage was done to Chinese households this year as the economy faltered amid a property slump, along with restrictions due to outbreaks of COVID-19.
The October-to-December survey added to already-grim data from the third quarter, which also measured weak prospects for jobs and housing.
The Chinese government has in the past few weeks rapidly pivoted away from its “zero COVID-19” strategy, with quarantine for inbound travelers — the last major curb remaining — to be scrapped in the next couple of weeks.
However, while economic activity is expected to rebound, it is unclear how quick that would happen given the spread of infections and the weakness in confidence.
Unlike advanced economies such as the US, China has refrained from handing out subsidies directly to residents during the pandemic.
Housing market confidence also continued to deteriorate in the fourth quarter, even as the government stepped up efforts to rescue the sector.
Only 14 percent of respondents to the central bank’s survey expected home prices to rise next quarter — another fresh low in data going back to 2010.
There were 18.5 percent who expected home prices to fall, the highest proportion since 2012.
Only 16 percent of respondents said that they planned to buy a home in the next three months, down from 17.1 percent in the previous quarter.
Nearly 62 percent said that they were saving more, up from 58 percent, the survey showed.
Another central bank survey showed business conditions and export orders among industrial companies in the final three months of the year deteriorated to the worst level since the second quarter of 2020.
Meanwhile, domestic orders weakened from the previous quarter, based on indices compiled from the survey of more than 5,000 firms.
Overall loan demand in the economy improved slightly, with a corresponding subindex rising to 59.5 in the fourth quarter from 59 in the previous quarter, a People’s Bank of China survey of 3,200 bank representatives showed.
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