Aug 05, 2024 07:37 PM
ECONOMY
China’s New Economy Industries Suffer as Tech, Capital, Labor Inputs Drop
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Power workers check equipment's temperature at an energy storage station in Dainan town, East China's Jiangsu province, on July 22. Photo: VCG
The contribution of high value-added industries, such as biomedicine, to China’s total economic inputs dropped in July from a seven-year high, due to record-low labor inputs and declines in capital and tech inputs, a Caixin index showed Friday.
The Caixin BBD New Economy Index (NEI) slipped 1.4 points from June to 31 last month, indicating that new economy industries accounted for 31% of China’s overall economic input activities.
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- The Caixin BBD New Economy Index (NEI) fell 1.4 points to 31% in July due to reduced labor, capital, and technology inputs.
- Labor inputs dropped to a record low of 20.2, while capital inputs decreased to 42.1; technology inputs fell slightly to 32.9.
- The new information technology industry was the largest contributor to the NEI, rising to 11.8 points in July.
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Who’s Who
- Caixin Data Technology Co. Ltd.
- Caixin Data Technology Co. Ltd. collaborates with Chinese big-data research firm BBD and the National School of Development at Peking University to produce monthly New Economy Index (NEI) reports. The NEI tracks labor, capital, and technology inputs in emerging industries in China.
- National School of Development at Peking University
- The National School of Development (NSD) at Peking University is a prominent academic institution in China that collaborates with Caixin Data Technology Co. Ltd. and BBD on monthly NEI reports. The NSD specializes in economic research and development, contributing to the analysis and tracking of emerging industries within China's economy.
- BBD
- BBD is a Chinese big-data research firm that collaborates with Caixin Data Technology Co. Ltd. and the National School of Development at Peking University to produce the monthly Caixin BBD New Economy Index (NEI). This index uses big data to measure labor, capital, and technology inputs in 10 emerging industries relative to those used in all industries, evaluating the scale of China's nascent industries.
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What Happened When
- March 2016：
- The NEI was launched, defining new economy industries as those that are technology- and human capital-intensive but asset-light, experiencing sustainable and rapid growth, and strategically encouraged by the government.
- July 2024：
- The contribution of high value-added industries to China’s total economic inputs dropped due to record-low labor inputs and declines in capital and tech inputs.
- July 2024：
- The Caixin BBD New Economy Index (NEI) dropped 1.4 points from June 2024 to 31.
- July 2024：
- Labor inputs fell 1.6 points to 20.2, the lowest level on record.
- July 2024：
- The subindex for capital inputs declined by 1.4 points to 42.1.
- July 2024：
- Technology inputs declined by 0.7 points to 32.9.
- By July 2024：
- The new information technology industry became the largest contributor to the index, climbing 0.7 points from June 2024 to 11.8.
- July 2024：
- The average monthly entry-level salary in the monitored industries was 13,464 yuan ($1,887), down 99 yuan from the previous month.
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