Chinese media reported that China is considering introducing “super-strong” measures aimed at providing support to the smaller firms, particularly those with low profitability and small capital in order to boost their competitiveness and retain their jobs.
“Struggling firms, many of which are small, have already spent years cutting down the employment costs of their workers,” the Beijing Daily quoted Wu Kan, head of the National Development and Reform Commission (NDRC), as saying.
“We must adjust the way they manage their staff: to give more allowances and other conditions so that workers can continue to carry out important jobs. We must also improve management of their business operations and liquidity,” he said.
According to Wu, some firms are cutting down on job creation, adding that “it’s too long for the inevitable deterioration in their work culture and social policy situation to manifest itself.”
China’s economic slowdown has hit the smaller firms particularly hard, they said. Meanwhile, the work culture has become increasingly casual and people work almost six days a week.
“The corporate spending of these firms has fallen by 20 percent since 2014,” Wu said.
When he spoke at a recent summit of Chinese state-owned enterprises (SOEs) on Saturday, Wu also said that the country has to return to a “normal mode” of economic growth in the second half of the year.
From June to September of last year, China recorded its slowest economic growth in 26 years, with growth slowing to 6.6 percent, dragged down by a cooling property market and weakening exports.