China is on the edge of an economic crisis, but its government is struggling to convince its young people to help fix its problems. One major issue China is facing is that its recent graduates are no longer spending as they used to, due to fears of running out of money.
This has been connected to a number of issues faced by China’s younger generations, including youth unemployment figures hovering at 20%, fears that those with jobs may lose them and an ongoing property crisis making home ownership seemingly unreachable, especially in China’s big cities. As a result, social media is being flooded with advice on why Chinese youth should embrace frugality and money-saving tips. Others are concentrating on eating on a budget.
According to the BBC, influencer Zhang Small Grain, 24, said her content is “dedicated to a minimalist way of life”, featuring how she uses a simple bar of soap for all her cleaning needs, rather than expensive products. She has amassed 97,000 followers on the Xiaohongshu (Little Red Book) site and companies pay her to feature their goods in her videos.
“I hope more people will understand consumption traps so they can save. This will reduce their stress and relax them,” she said.
Meanwhile, another influencer, who goes by the name of Little Grass Floating In Beijing, 29, posts videos of himself cooking basic dishes, claiming he can have two meals for just $1 (£0.76). He claims his modest lifestyle and job at an online sales firm have allowed him to save over $180,000 (£137,000).
“I am just an ordinary person from the countryside. I have neither a good educational background nor a network of influential contacts, so I must work hard for a better life,” he said.
Meanwhile, it is becoming a growing trend in China for unemployed young people to pay companies to pretend to work for them, choosing to go into an office instead of being stuck at home. Such operations are now emerging in major cities across China, including Shenzhen, Shanghai, Nanjing, Wuhan, Chengdu, and Kunming, with offices equipped with computers and internet access, allowing attendees to search for jobs or launch their own start-ups. The daily fee – including lunch, snacks and drinks – usually costs between 30 and 50 yuan (£3.20-£5.30).
The Chinese government has been promising for several years to increase household consumption; however, it still accounts for only about 39% of GDP, compared to about 60% in most developed countries. Meanwhile, while the US is struggling with nationwide credit card debt, China faces an opposite challenge, with people inclined to save rather than spend.
While in 2025, China has a target growth of around 5%, it is facing structural challenges, including weak consumer confidence resulting in low inflation, a property sector burdened by debt, income and regional disparities and trade tensions and export restrictions from other countries, particularly the US.
With the arrival of Donald Trump for his second term as president, the US imposed a 145% tariff on Chinese goods, with CHina imposing a 125% tariff on American goods in response. These measures are forecast to result in a 0.2% decline in global merchandise trade. The two major nations continue to seek a solution to the trade war.