While actively promoting employment and improving individual incomes, comprehensively strengthening and perfecting the social security system, and improving the restrictive factors in various aspects such as education, healthcare, elder care, and housing, are topics of widespread concern. The data released by the National Bureau of Statistics show that the consumer price index (CPI) in February increased by 0.7% year-over-year, marking the first positive growth since September last year. Excluding food and energy prices, the core CPI rose by 1.2% year-over-year, reaching the highest increase since February 2022.
The return to positive growth of the CPI is not only due to the low base effect of the Spring Festival period but also reflects the strengthening of domestic demand recovery and consumption resurgence. This year’s government work report particularly emphasized employment and household income growth and explicitly proposed to stimulate consumption potential from multiple aspects, including increasing income, optimizing supply, and reducing restrictive measures, to thereby expand domestic demand and stabilize economic growth.
During this year’s National “Two Sessions,” several NPC deputies and CPPCC committee members were interviewed. They stated that measures to promote increased consumption should include improving employment rates and stabilizing and improving social income expectations. In addition, strengthening and perfecting the social security system, and focusing on improving services in areas such as education, healthcare, elder care, and housing, are consumption constraints that need to be addressed.
Data disclosed by the National Bureau of Statistics on March 9th revealed that the national CPI in February rose by 1.0% month-over-month, an increase of 0.7 percentage points compared to the previous month; year-over-year, it switched from a decline of -0.8% the previous month to an increase of 0.7%, showing a significant rebound. Among them, non-food prices achieved year-over-year increases, especially the rise in prices of travel-related services, which became the main factor driving the year-over-year CPI increase.
Analyst Zhang Liqun pointed out that increased consumer demand during the Spring Festival period, and this year’s Spring Festival falling in a different month compared to last year, are the main factors driving the rise in February’s CPI year-over-year data. Excluding the Spring Festival effect, China’s prices remained at a low level and operated stably in February. This indicates that there is still ample operational space for fiscal and monetary policies to promote domestic demand in the future.
During this year’s Spring Festival holiday, multiple consumption indicators reached historical new highs. For example, the number of domestic tourist trips during the Spring Festival reached 474 million, with total spending amounting to 632.687 billion yuan, achieving significant growth compared to 2023 and 2019. In addition, the Spring Festival movie box office revenue in 2024 reached 8.016 billion yuan, with 163 million cinema visits, an increase of 18.47% and 26.36% respectively compared to the Spring Festival period in 2023, setting new records for the same period.
Economist Lian Ping noted that China’s consumer market shows positive signs of being fast, structurally innovative, vibrant, and having great potential, but there are still issues such as weak demand, reduced per capita consumption, and poor sales of automobiles and real estate. Although total tourism revenue and the number of trips reached new highs during the Spring Festival, per capita tourism consumption has not yet recovered to pre-pandemic levels.
With the economy gradually recovering, businesses’ operating conditions and profitability have improved significantly. A stable job market and gradually rising household incomes provide a solid foundation for the sustained growth of service consumption. Moreover, the rapid increase in catering consumption, the revival of real estate sales, and the improving trend of car sales, all under the effective implementation of consumption-boosting policies, suggest that consumer demand is expected to be released more widely, thereby driving continuous and rapid growth in consumption, and achieving the set economic growth target for the year.
Key policy measures will focus on promoting employment, increasing income, supporting service industry enterprises, stimulating automobile sales, and improving the operating environment for real estate companies, among other aspects. These initiatives are dedicated to the sustained and rapid revival of consumption. Promoting employment and income growth is seen as the main means to stimulate consumption. Expanding employment opportunities while maintaining a stable job market, and working to increase people’s income levels, are key to further strengthening consumption ability and willingness, and unlocking consumption potential.
The government’s goal is to set the urban new employment target for 2024 at “over 12 million people,” compared to “around 12 million people” in 2023, showing further determination. This reflects the government’s strengthened policy direction in the job market. At the same time, keeping the growth target of residents’ per capita disposable income in line with economic growth indicates a more proactive income increase policy direction.
To increase residents’ income, the minimum standard for basic pension for urban and rural residents is planned to increase by 20 yuan in 2024, compared to the standard of 103 yuan in 2023. This will undoubtedly bring substantial benefits to about 160 million elderly people. Improving the standard of farmers’ pensions is one of the effective ways to promote consumption.
While addressing structural contradictions and total pressures in the employment market, China’s employment situation remains stable, marking the long-term positive trend of China’s economy. To maintain stability in employment, the government will continue to reduce unemployment and work-injury insurance rates, and improve policies such as job stabilization refunds, special loans, and subsidies for employment and social security, ensuring the full implementation of policy dividends. Support for various business entities, the private economy, and small and medium-sized enterprises, as well as the cultivation of new growth points such as the digital economy, silver economy, and green economy, will become new drivers for the job market.
The government will also increase support for entrepreneurship, including guarantee loans, tax and fee reductions, and site arrangements, to unleash the potential of entrepreneurship to drive employment. In addition, improving service guarantees for flexible employment and fully utilizing the supply and demand docking function of the gig market helps workers to develop multiple channels for flexible employment. Promoting the continuous optimization of the employment market structure, while improving job quality, it is also necessary to focus on achieving the consistency of economic transformation and employment transformation, high-quality development, and high-quality employment.
This year, the number of graduates from our country’s colleges and universities is expected to exceed 11.7 million, forming a key group to promote employment. To facilitate higher quality and more substantial employment for these graduates, it is necessary to deepen the reform of universities in the “employment-admission-training” linkage mechanism. This involves optimizing professional settings and structures to better meet market needs.
To ensure employment opportunities for young people, it is essential to consider reducing the operational burden for small and medium-sized enterprises. A specific proposal is to halve social security costs for employees who are insured for the first time in the initial two years, while ensuring they receive benefits according to the full payment standard. This helps reduce the labor cost for enterprises, thereby promoting a flourishing employment market.
Additionally, it is suggested that graduates expand their job search beyond cities like Beijing, Shanghai, Guangzhou, and Shenzhen. Cities such as Changsha, Chongqing, and Chengdu also offer abundant job opportunities and are worthy of the graduates’ attention and exploration.
In the process of enhancing employment rates and incomes, it is also necessary to further improve the social security system, including aspects such as education, healthcare, elderly care, and housing, in order to alleviate consumers’ concerns about future uncertainties. For instance, recommendations to reduce the burden of medical insurance payments for urban and rural residents suggest a temporary suspension of raising the payment standards for individual participants, establishing zero-payment or low-payment insurance brackets to fit the actual affordability of the population.
To address the common issues of “difficulty and high cost of accessing healthcare,” healthcare reforms should be continuously promoted, removing the deductible for reimbursement of outpatient care at the grassroots level, and strengthening the management of the medical insurance fund. Furthermore, the quality of primary healthcare services should be enhanced to ensure the efficient and rational use of funds.
This year, the development of the so-called “silver economy” is seen as an important direction for promoting consumption while also considering the perfection of the elderly care security system. It is proposed to quickly formulate high-quality development plans and related policies for the silver economy, including improvements in land supply, financial subsidies, credit financing, tax relief, and talent training policy systems.
Although China’s health and elderly care industry has developed rapidly in recent years, with significant improvements in the quantity and quality of elderly care services and products, the industry still faces issues such as the need for better supportive policies, low standardization of services, and insufficient market entities. In this regard, the creation of relevant policies and standards is called upon to promote the high-quality development of the health and elderly care industry.
To effectively promote the development of the health and elderly care industry, experts have made a series of optimization recommendations. On one hand, it is advised that policies related to health and elderly care, such as fiscal, tax, land, and talent policies, are to be improved in a more exhaustive and considerate manner. This involves reviewing, adjusting, and supplementing existing policies to ensure they precisely serve the industry’s actual needs and long-term planning.
On the other hand, the industry’s standards and norms system also needs to be established and improved. Standardization and regulation are key to enhancing the overall service level and efficiency of the industry and can ensure the quality and safety of elderly care services, providing consumers with a stable and reliable service experience.
Moreover, industrial development should be based on elderly care and medical services, forming a diversified, multi-level industry chain. Such an industry chain should be inclusive of various related services and products, stimulating synergistic effects within the industry, and fulfilling the diverse needs of the aging population.
Support and encouragement are also given to large elderly care enterprises to integrate existing resources and transform vacant or underutilized properties into capital for industrial development, which not only optimizes resource allocation but also injects new vitality into the market.
Accelerating the training and development of leading companies within the industry is another important aspect. Leading companies can play a demonstrative and leading role by using their brand influence to drive the development of the entire industry. Particularly, the creation of inclusive elderly care service brands is crucial for promoting the industry’s popularity and acceptance.
