Caixin
Jul 02, 2020 07:49 PM
ECONOMY

Caixin New Economy Index Hits Nearly Three-Year High

A worker mills parts for a coreless grinder on May 7 at a high-end equipment-maker in Southwest China's Guizhou province.
A worker mills parts for a coreless grinder on May 7 at a high-end equipment-maker in Southwest China's Guizhou province.

The contribution of high value-added industries to China’s overall economic inputs in June hit the highest level since August 2017 as capital inputs increased, a Caixin index showed Thursday.

The Mastercard Caixin BBD New Economy Index (NEI) came in at 32.1 last month, indicating that new economy industries accounted for 32.1% of China’s overall economic input activities. The reading was up from 31.1 in the previous month.

The NEI aims to track the size of, and changes in, China’s nascent industries by using big data. It measures labor, capital and technology inputs in 10 emerging industries relative to those used by all industries.

The increase in last month’s NEI was mainly due to a rise in the subindex for capital inputs, which has a 35% weighting. The subindex last month rose 4.6 points from the previous month to 42.5.

The technology input subindex, which has a 25% weighting, fell 2.2 points from the previous month to 27.8, marking the second decline in a row. 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 for labor inputs, which has a weighting of 40%, dropped 0.3 points from the previous month to 25.6 in June.

The NEI, launched in March 2016, defines a new economy industry as one that is human capital- and technology-intensive but asset-light, experiences sustainable and rapid growth, and is a strategic new industry encouraged by the government.

Of the 10 tracked industries, new information technology remained the top contributor in June, making up 11.1 percentage points of the NEI reading. The new materials industry grew the fastest in terms of contribution, ranking fifth, up from eighth the previous month.

The average monthly entry-level salary in new economy industries, based on data compiled from online career and recruitment websites, was 11,460 yuan ($1,621) in June, 3 yuan higher than the month before.

The monthly NEI reports are written by Caixin Data Technology Co. Ltd. and Chinese big-data research firm BBD, in collaboration with the National School of Development at Peking University.

Contact reporter Tang Ziyi (ziyitang@caixin.com) and editor Joshua Dummer (joshuadummer@caixin.com)

Caixin Global has launched Caixin CEIC Mobile, the mobile-only version of its world-class macroeconomic data platform.

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