China's Top Private Firms Cut 300,000 Jobs in 2023 Despite Financial Growth

Despite modest financial growth, top private companies in the country cut more than 300,000 jobs last year, A report from China's largest business association revealed. According to the All-China Federation of Industry and Commerce, statistics showed that in 2023, 10.66 million individuals were employed by 500 top private businesses, which was a decrease of 314,600 jobs from the year before.

The substantial decrease in workforce has sparked worries about the private sector's susceptibility to the slowdown in China's domestic economy. Analysts have emphasized the importance of more government assistance, particularly after the introduction of a new bill aimed at boosting the private economy, revealed by Beijing on Thursday.

Harry Murphy Cruise, an economist at Moody's Analytics, was quoted in The South China Morning Post as saying that the uncertainty facing firms is emphasized by the fact that despite rising revenues, employment fell.

Factors such as heightened automation and efforts to improve efficiency, especially in competitive sectors like manufacturing, were pointed out as possible reasons for the layoffs.

In China, the manufacturing sector, typically known for its heavy reliance on labor, continues to be the leading industry among private companies. 66.4 percent, or 332 out of the top 500 companies, are involved in manufacturing, an increase from 322 the year before. Moving towards automation and smart production is a key aspect of China's overall plan to update its economy due to global competition and lack of workers.