New Economy Index Hits New High for 2018

The contribution of high-value-added industries to China’s overall economic inputs hit a new high this year in November, as capital inputs increased significantly, according to a private index released on Sunday.

The Mastercard Caixin BBD New Economy Index (NEI) climbed to 31.33 in November from October’s 29.8, indicating that “new economy” industries accounted for 31.33% of China’s overall economic input activities — the highest reading since December 2017. The NEI measures labor, capital and technology inputs in 10 emerging industries relative to those in all industries.

Among the three subindexes that make up the NEI, the one for capital inputs recorded the biggest rise, picking up by 2.5 points to 37.1 in November from the previous month. Capital inputs have a weighting of 35% in the NEI.

The subindex of technology inputs, which has a weighting of 25%, rose by 1.9 points to 29.3 in November. This gauge measures the number of scientific research personnel recruited by the tracked industries, and the number of inventions they created and patents they obtained. The subindex of labor inputs picked up by 0.5 points to 27.6.

Launched in March 2016, the NEI defines a new-economy industry as one that is labor- and technology-intensive but asset-light; experiences sustainable and rapid growth; and is in a strategic industrial sector encouraged by the government.

Among the 10 tracked industries, the new information and technology sector remained the top contributor, making up 12.1 percentage points of the NEI’s reading, up by 1.3 percentage points from October. Financial and legal services came in second, while advanced equipment manufacturing ranked third.

The average monthly entry-level salary in new-economy sectors, based on data compiled from online career and recruitment websites, was 10,212 yuan ($1,467) in November, slightly higher than that in October.

The monthly NEI reports are compiled by Caixin Insight Group — a financial data and analysis platform of Caixin Media, and Chinese big-data research firm BBD, in collaboration with the National School of Development at Peking University.

Contact reporter Lin Jinbing (jinbinglin@caixin.com)

Read more about Caixin’s economic indexes.