As Covid-19 takes a toll on economy China’s fear of mass job losses looms.
The outbreak is wreaking havoc on economic activities. Thus, firms are facing a tough decision about whether to reduce swages and staff levels to be able to survive.
This week President Xi Jinping said that local governments need to work hard to ensure the general stability of the job market.
Xinchao Media is a large advertising firm. On Monday, the firm laid off 500 people across 80 cities. It accounts for around 10 percent of its total workforce.
Following extended holidays or work from home arrangements for combating the coronavirus outbreak, more people return to work across China. Some have worries that the resulting economic slowdown will have an outcome of job losses.
The coronavirus is causing the disease now officially known as Covid-19. In China, it had led to the death of over 1,300 people and infected around 60,000. Across the country, it has wreaked havoc on economic activities. Firms are facing a tough decision on whether to reduce swages and staff levels to be able to survive.
In China, there was a more extended Lunar New Year break than usual. LvYue group s a tourism and resort company backed by industry giant trip.com officially known as ctrip. The company has announced that it is cutting the salaries and working hours of staff from the executive level and above by thirty percent.
The company is employing thousands of staff, which run around 1,900 hotels and hostels globally near popular tourist attractions. Many of those were forced to close because of coronavirus fears, blamed to plunge revenues for the decision.
China in Crisis
CEO Zhang Qian wrote a letter. It was partially an answer to the reports made last week. The report said that the company planned to start massive lay-offs. Later, LvYue Group confirmed cuts of the job because of the deteriorated business conditions will be less than 20 percent.
Nevertheless, Zhan did not mention lay-offs in the letter. He said that the company would try to stay competitive. It plans to reduce all possible expenses, remove bad business segments, and end losses and non-quality growth.
Xinchao Media is a large advertising firm. On Monday, the firm laid off 500 people across 80 cities. It accounts for around 10 percent of its total workforce. Zhang Jixue is the chief executive of the company. He said that in February, business decreased by seventy percent. The decision was made because there was a possibility that the impact of the Covid-19 may continue into the second quarter of 2020.
A Beijing-based education firm to specializes in coding skills last week also dismissed all its staff. Meanwhile, China’s capital city’s karaoke company released a plan to lay-off more than 200 employees.
There was a high-level meeting in China on Wednesday. Chinese President Xi Jinping said that local governments need to work hard to ensure the general stability of the job market.
Millions of people are put in limbo because of the coronavirus outbreak. Particularly those who work would like ins hotels retail stores, and restaurants. Let’s hope that China will deal with the current difficult situation successfully.