Caixin
Apr 02, 2021 06:45 PM
ECONOMY

Another Rise in Capital Inputs Drives Up Caixin New Economy Index

New constuction materials are produced at a factory in Jingzhou, Hubei province. Photo: VCG
New constuction materials are produced at a factory in Jingzhou, Hubei province. Photo: VCG

The contribution of high value-added industries such as advanced materials and new energy to China’s total economic inputs rose in March, due to an increase in capital investment, a Caixin index showed.

The Mastercard Caixin BBD New Economy Index (NEI) came in at 29.1 last month, indicating that new economy industries accounted for 29.1% of China’s overall economic input activities. The reading was up from 28.2 in the previous month.

The NEI, which was released Friday, uses big data to track the size of China’s nascent industries. The index measures labor, capital and technology inputs in 10 emerging industries relative to those used by all industries.

The rise in last month’s NEI was due to a climb in the subindex for capital inputs, which has a 35% weighting. The subindex rose 3.7 points from February to 34.8.

The technology input subindex, which has a 25% weighting, dropped 1.3 points month-on-month to 28.8 in March. This gauge measures the number of research personnel recruited by the tracked industries, and the number of inventions they have created and patents they have obtained.

The subindex for labor inputs, which has a weighting of 40%, decreased by 0.3 points from the previous month to 24.3.

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 and technology became the largest contributor in March, making up 8.1 percentage points of the NEI reading. The culture, sports and entertainment industry saw the fastest climb up the rankings, rising to third position last month from sixth in February and contributing 5.9 percentage points to the reading.

The average monthly entry-level salary in new economy industries, based on data compiled from online career and recruitment websites, rose to 12,133 yuan ($1,845) in March, 145 yuan lower 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)

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