China wants people to stop talking about its terrible economy

The country’s statisticians will temporarily pause the release of the joblessness rate among urban individuals aged between 16 and 24 for “further optimization,” a spokesperson for the National Bureau of Statistics said Tuesday.

The bureau said it wanted more research on “whether students looking for a job before graduation should be counted in the labor statistics.”

Twenty-one percent of those aged between 16 and 24 were unemployed in June, a record high, following records set during the two previous months.

And July’s data, if the bureau had released it, would likely have been worse, as an estimated 12 million graduates begin to enter the workforce. (China’s general urban unemployment—which the bureau did release on Tuesday—was 5.3% in July, up 0.1 percentage points from the month prior).

Youth unemployment is now a major crisis for China’s government.

Construction and manufacturing, both sectors that hire younger migrant workers, are struggling thanks to China’s real estate crash, weak domestic consumption, and sluggish foreign trade.

The country’s tech sector, which normally hires many of China’s skilled graduates, is also slowing hiring following a years-long crackdown from regulators.

Chinese officials are now offering assistance and subsidies to encourage companies to hire young graduates, as well as pushing younger jobseekers to consider working in the countryside. 

But even the official line is pessimistic. Chinese president Xi Jinping drew social media ire for suggesting that young Chinese may have to “eat bitterness”—a colloquialism that suggests a need to endure hard times—in order to find success.

And the president of one Chongqing-based university told his 9000 graduates in June not to “aim too high or be picky about work,” according to the New York Times.

Incorrect data

Some Chinese economists agree that the country’s youth unemployment data is wrong—but that current measures likely undercount, not overcount, joblessness. 

In a widely-circulated article earlier this year, Wang Mingyuan, a researcher at the Reform and Development Institute of Beijing, a think tank, suggested that China sets its threshold for employment too low—just one hour a week—and struggles to count both migrant workers and those working in the gig economy. 

Then last month, Zhang Dandan, a professor of economics at Peking University, estimated that the country’s youth unemployment rate could be as high as 46.5% if one were to include those “lying flat”: Young Chinese who have voluntarily taken themselves out of the labor force. (Most measures of unemployment don’t include those not actively pursuing employment)

Not even Beijing trusts the data, as education officials probe universities to ensure they aren’t asking graduates to lie about their employment status.

Stop talking about bad news

More broadly, China’s economic recovery is quickly losing steam.

On Tuesday, the statistics bureau reported below-expectations growth in industrial production and retail sales.

That follows credit data from the People’s Bank of China, the country’s central bank, reporting that just $47.8 billion in new loans were offered in July, an 89% drop from the month prior and just over half of the amount offered a year ago.

Trade is also plunging, with July exports down 14.5% year-on-year.

Beijing has already suspended one poorly-performing metric. In March, the statistics bureau stopped publishing its measure of consumer confidence.

Authorities have also clamped down on outbound data flows, and raided due diligence and expert networks firms, sometimes on national security grounds. 

Officials are also reportedly pressuring economists, analysts and other commentators not to share bad news about the Chinese economy, forcing them to turn to euphemisms like “subdued inflation” rather than talk about the risk of deflation.

Lawyers are being told to talk about how China’s economy is “evolving,” rather than going through “adverse changes,” reports the Wall Street Journal.

Regulators “wanted us to interpret bad news from a positive light,” one adviser to the central bank told the Financial Times.