China censors economic, financial writer Wu Xiaobo for ‘hyping up unemployment rate’ amid economic slowdown
- Wu Xiaobo and two other users are suspended by Chinese social media platform Weibo for ‘disseminating negative and harmful information’
- Ban comes on the same day a National Audit Office report says more than 980 million yuan (US$135.6 million) in employment subsidies were defrauded in 2022
A prominent economic and financial writer has again been suspended by Chinese social media platform Weibo for “disseminating negative and harmful information” about the country’s economy, as Beijing continues to censor online speech amid a sputtering post-coronavirus recovery.
Wu Xiaobo, along with two other users, “hyped up the unemployment rate”, “smeared the development of the security market”, and “attacked and undermined” China’s current economic policies, according to a statement from the Twitter-like social media platform on Monday.
It is not clear which of Wu’s social media activity led to the suspension, but in late May on Xiaohongshu – another social media platform – he said that “the industrial economy is sluggish, and private entrepreneurs collectively lack the willingness to invest”.
“The manufacturing and real estate sectors, which could traditionally absorb hundreds of millions of employees, are weak and unable to provide new job pools,” Wu added on his official Xiaohongshu channel.
6 takeaways from China’s economic data as youth unemployment hit a new high
The rate is expected to rise further in July and August, with a record 11.58 million university graduates set to leave campus.
The overall urban surveyed jobless rate remained unchanged at 5.2 per cent last month, but there have been frequent reports of lay-offs at major tech companies in recent months.
As of Tuesday, Wu’s latest post visible on his Weibo account, where he has 4.7 million followers, is from April 2022.
Wu did not respond to a Post request for comment.
In June last year, Wu’s accounts on various social media platforms were temporarily suspended, along with a slew of outspoken economists who were banned after critical takes on Beijing’s controversial zero-Covid policy.
Wu’s latest suspension came on the same day the National Audit Office released its 2022 work report, which focused on the embezzlement of the fiscal budget designated for employment, housing, education and rural development.
According to the report, which looked at the use of employment-promotion funds in 24 provincial-level jurisdictions, along with the quasi-military Xinjiang Construction and Production Corps, more than 980 million yuan (US$135.6 million) worth of subsidies that should have been provided to qualified employees and employers were kept by 565 labour-dispatch companies.
It also showed more than 42.82 million yuan worth of funds were defrauded by 71 labour-dispatch companies through means including fabricating employment contracts.
The so-called practice of labour dispatching is popular in China, and involves hiring employees through an employment service agency.
A further 123 million yuan worth of special funds designated for vocational training, and 52.33 million yuan worth of unemployment subsidies, were also defrauded by training institutions and employers last year, the report showed.
With rounds of stimulus over the past two decades, the scope for easing and stimulus has narrowed significantly
Weakening consumption growth, low investment from private industry and a sluggish demand for China’s exports have led major international investment banks to slash their 2023 gross domestic product forecasts for the country.
The yuan has also been tumbling against the US dollar in the past two months, with offshore and onshore trading passing the closely watched figure of 7.2 per US dollar in recent weeks.
Nomura chief China economist Lu Ting said that while more rounds of rate cuts are expected, it is most likely that monetary measures will have little impact, and Beijing may have to once again ramp up support for local governments and speed up infrastructure investment.
“With rounds of stimulus over the past two decades, the scope for easing and stimulus has narrowed significantly due to mounting government debt, significant misallocations of financial resources and a plummeting return on capital, as well as falling home prices and fading home demand in many cities,” Lu said.
