# data[].attributes.body
Meat prices are declining due to outbreak of H7N9 bird flu. Even though the government is culling birds to minimise spread of the virus, demand for poultry decreased at a much faster rate, due to people's fear of contracting the virus, than decrease in supply, hence meat prices fell.

Health consciousness led to a preference for vegetables instead of meat, leading to decreasing demand of meat such as pork and beef, hence the lower prices. Vegetable prices fell as when people demand for less meat, there will be more leftover crops that are initially grown for animal feeds such as soybean and maize. The increase in vegetable supply then led to a temporary decrease in the prices of vegetables where supply exceeds demand.

Cost of healthcare and transportation increased, resulting in higher CPI despite huge decrease in food prices. The aging population led to majority of the households spending more on hospital bills and medications as health of elderly deteriorates. Also, it has become increasingly popular for people to opt for eletric vehicles (EVs) rather than internal-combustion-engine vehicles (ICEVs). The upfront cost of an EV is much more expensive than a regular ICEV, resulting in the transportation prices in CPI weights to rise.

# data[].attributes.body
At the start of the year January 2017, inflation rate was the highest at 2.5% as compared to the previous 2 years. However, there was a steep decrease of inflation rate to 0.8%. Currently, the inflation rate is steadily increasing again.

# data[].attributes.body
There is very gentle increase of GDP from 1960s to1980s. GDP then began to increase gradually from 1990s to 2000. This is followed by a steep increase of GDP from 2000 to 2015 (from 1.211 trillion USD to 11.065 trillion USD).

# data[].attributes.headline
Business Cycle & Unemployment - Conclusion

# data[].attributes.subject
Business Cycle & Unemployment - Conclusion

# data[].attributes.body
Unemployment is always present in any economy. In China, the country’s current unemployment rate hit a record low of 3.97% since 2002. This may be due to the aging population, by the “One-Child Only” Policy implemented. Technically, since the policy shrank the workforce, labour force and unemployment rate will be smaller. other than that, unemployment rate declined due to higher export demands. Some of the 3.97% are facing structural unemployment as improving technologies in industries left their skills outdated.

The Chinese government has the responsibility to help those who faces this issue to improve by pushing and giving them opportunities to learn new skills such that they remain employable in the advancing economy. This will then lower the unemployment rate and the country will be closer to achieving their natural rate of unemployment.

# data[].attributes.body
Hence, as seen from the article and the data provided, if the GDP of China continues to slow down, it will come to a point where the GDP will experience stagnation or reach a substantial but not advanced level. This may cause workers to be unable to advance in their career or even cause them to be retrenched, resorting to being underemployed.

To prevent this from happening, government intervention is needed. The Chinese government needs to create a better environment or system to the education in China which will allow the country to develop a more innovative labour force, which will increase productivity.

The Chinese government also needs to allow market forces to be allocated to the more competitive and productive companies and industries. This will allow them to purchase more resources to actively invent and compete in the world, which will increase productivity and hence GDP.

Chinese companies also need to invest in research and development, to keep up with other competitors like Japan or Korean. This will allow them to constantly create new ideas which will make them more relevant in the world and help increase demands in their products and increase the GDP.

# data[].attributes.body
Unemployment rate has been generally low. Recently, its been showing a decreasing trend as unemployment rate decreases to 3.97%.

# data[].attributes.body
Meat and vegetable prices decreased, however, other CPI weights such as healthcare and transportation increased more, which resulted in China’s inflation rate to be at 1.2% in April. The government needs to take action to increase the foods’ prices as continual decrease in food prices may not be beneficial to the economy in the long run due to decreased aggregate expenditure, then leading to fall in production, resulting in the country facing economic stagnation or even recession. Other than that, more is to be done to make healthcare system more affordable and effective. New energy vehicle industries that strive to minimise vehicle pollution may not be a great burden to the Chinese’s cost of living, considering the fact that CPI fails to reflect quality difference in goods.

# data[].attributes.body
Food prices make up of one-third of China’s CPI basket. Currently, prices of meat and vegetables have been steadily dropping. The CPI in April rose by 1.2%, year on year, below the government’s target of around 3% for 2017. The CPI increase, even though certain foods’ prices decreased, is due to a higher increase of non-food commodities prices, which caused the overall CPI to increase. The low and steady rate of inflation also goes to show that the economic is doing well in its recovery phase.

# data[].attributes.attachment_link.title
China's meat, produce prices continue to retreat - Xinhua | English.news.cn

# data[].attributes.attachment_link.description
The average prices of 30 different vegetables dropped 1.7 percent last week, with the prices of garlic, onions and beans down 13.8 percent, 7.4 percent and 5.8 percent, respectively, the Ministry of Commerce (MOC) said in an online statement.

# data[].attributes.headline
Business Cycle & Unemployment - Causes of lower unemployment rate /difficult employment situation

# data[].attributes.subject
Business Cycle & Unemployment - Causes of lower unemployment rate /difficult employment situation

# data[].attributes.body
The global demand for China's export items, such as electrical equipment, clothing and furniture are increasing. With an increase in demand, more labour is required, thus unemployment rate drops.

Structural unemployment caused employment situation to remain difficult. China’s “Internet Plus” strategy was introduced in 2015 in an attempt to boost economic growth by integrating technology into the many industries in China, in particular, the manufacturing industry. With the newer, upgraded industries, the unemployed will find it increasingly harder to find jobs as they lack the skill required for those jobs. Time will be required for them to learn the new skills, leading to long term shortage of skilled workers.

The government aims to create 11 million new jobs by the end of 2017, but this amount may still be insufficient. China's expansion of the higher-education system since 1999 led to a great amount of university graduates. In fact, it was estimated that 7.95 million university graduates will be graduating this year. China's shrinking of the bloated industries will also require them to open up vacancies to transfer the hundreds of thousands of workers affected to other industries. Bringing foreign talents into the account as well, the rate of creation of new relevant jobs may not be on pace with the surging amount of people entering/transitioning in the workforce, making it hard for the citizens to achieve employment.

# data[].attributes.body
China's economy has been built upon its manufacturing sector. Being a "factory" of the world is very easy when the country has a huge and growing population. However, it is significantly harder when the one-child policy slows growth, develops an aging population and creates a generation of young people that are unwilling to take over the low-paying jobs of their ancestors. This means that there will be less people that can contribute to China's GDP.

Zombie companies are those that earns just enough to pay off the interests of their debts and needs bailouts just to operate. This means that these companies are unable to employ more employees in order to save costs. These companies are taking market share and holding back talents who could work for other indebted firms. This lowers the productivity of these companies to earn profit, causing lesser GDP growth, resulting in a slowing economy.

Another cause of China's slowing economy is that China is transitioning from a developing country to a developed country. A double digit economic growth rate does not occur in developed economies. By transitioning from a manufacturing/export-led economy to a service economy, its impact on other countries will drop, decreasing the economy growth.

# data[].attributes.headline
Business Cycle & Unemployment - Summary of Article

# data[].attributes.subject
Business Cycle & Unemployment - Summary of Article

# data[].attributes.body
China’s unemployment rate dropped to a 14-year low of 3.97% in 2017 Q1, as labour market stabilises and improves, despite country's shrinking bloated industries. The manufacturing industry experienced the fastest labour demand growth. Currently, 3.34 million jobs were created, on pace with the government’s target of creating 11 million jobs. However, this still seemed to be inadequate as employment situation remains difficult.

# data[].attributes.attachment_link.readable_text
China's official registered unemployment rate fell to a 14-year low of 3.97 percent in the first quarter, even as policy makers pledge to cut jobs in industries with excess capacity.

The Ministry of Human Resources and Social Securities released the data at a briefing Tuesday in Beijing. Another jobless rate, based on surveys in major cities to give it greater accuracy, fell below 5 percent in March, the National Bureau of Statistics said last week.

The labor market "continued a trend of stabilization and improvement," a ministry spokesman said at the briefing. Demand for workers in manufacturing increased faster than the labor demand growth across all industries, according to the spokesman.

While the jobless gauge is is known for barely changing with economic cycles, and statistics officials are working on a newer and more accurate survey-based version, the decline in unemployment coincides with economic growth posting the first back-to-back quarterly acceleration in two years.
Read More: China Workers Get Smaller Pay Gains Even Amid Ample Openings
China created 3.34 million jobs in the first quarter, on pace to exceed the government's 11 million target for this year.

Still, the employment situation this year remains difficult. There's a long-term shortage of skilled workers in some newer, upgraded sectors, while aged, low-skilled workers and fresh college graduates find it hard to nail jobs, according to the ministry.

The urban registered unemployment rate remained between 4 percent and 4.3 percent from the end of 2002 through the end of 2016, and it was unchanged at 4.1 percent from 2010 to 2013, even as growth slowed during the same period.
- With assistance by Jeff Kearns

# data[].attributes.attachment_link.title
China's Jobless Rate Drops Below 4% for First Time Since 2002

# data[].attributes.attachment_link.description
China's official registered unemployment rate fell to a 14-year low of 3.97 percent in the first quarter, even as policy makers pledge to cut jobs in industries with excess capacity. The Ministry of Human Resources and Social Securities released the data at a briefing Tuesday in Beijing.

# data[].attributes.body
China's economy is slowing down due to the faltering productivity. The “One-child” policy shrank the labour force greatly. On average, in 2015, “each employed Chinese worker generated only 19% of the amount of GDP an American worker did”. “Zombie” companies in sectors like steel and coal also waste resources without contributing much to the GDP. Some of China’s campaign for innovation and “mass entrepreneurship” was not effective enough to garner productivity gains and have instead shrank China’s TFP in 2015. The current edge that China has over other countries will wither if they fail to increase their productivity.

# data[].attributes.attachment_link.readable_text
Photographer: Qilai Shen/Bloomberg

Just about everybody assumes that China will overtake the U.S. as the world's indispensable economy. One factor, however, could slow its seemingly relentless march and cast doubt on China's prospects for becoming an advanced economy: faltering productivity.

Sure, China is advancing daily in wealth, technology and expertise. But nothing is inevitable in economics. As costs rise and the labor force shrinks due to Beijing's decades-long "one-child" policy, China will need to squeeze a lot more out of each remaining worker to keep incomes growing. If not, China could succumb to a sluggish trajectory that threatens both its future and that of the entire global economy.

Despite China's reputation as a paragon of authoritarian efficiency, the country isn't immune to the global trend of dwindling productivity gains. The Conference Board, using adjusted economic growth estimates, figures that Chinese labor productivity rose 3.7 percent in 2015, a precipitous plunge from an average of 8.1 percent annually between 2007 and 2013. (Official Chinese statistics also show productivity growth falling off, although settling at higher rates.)

Of course, even that reduced clip looks drool-worthy to policymakers elsewhere. Labor productivity inched upwards by a mere 0.7 percent in the U.S. and 0.6 percent in the euro zone in 2015. But the smaller increases in China are a big problem, because it has so much catching up to do. Chinese workers are miserably unproductive compared to their U.S. counterparts. The Conference Board calculates that in 2015 each employed worker in China generated only 19 percent of the amount of GDP an American worker did. That's not a whole lot better than Indian workers, who created 13 percent.

China, like other economies in Asia, is facing the consequences of its past success. The region's economies achieved eye-popping growth rates by tossing their poor and primarily agrarian workers into industry and global supply chains. That unleashed a torrent of productivity gains, as peasant farmers started making everything from teddy bears to iPhones.

In other words, China propelled its rapid development by shifting underutilized labor and capital into a modern capitalist economy. (That's why Paul Krugman once argued that there was nothing particularly miraculous about the Asian "miracle.") Inevitably, though, such low-hanging, productivity-enhancing fruit gets picked as the economy advances. Then the bang you get for every buck of new inputs starts to taper off.

That's the challenge China now faces. As Harry X. Wu, a development expert at Japan's Hitotsubashi University, has put it: "China needs to focus on getting more out of its available resources, rather than relying on rapid capital accumulation."

The problem is that China isn't doing particularly well on that front. Financial resources continue to be wasted on inefficient, often state-owned enterprises in bloated industries -- all those "zombie" companies in sectors like steel, coal and cement. This steals critical resources away from more productive firms. As economists at Rabobank warned in a March report, the system works against the "favorable entrepreneurial environment and Schumpeterian creative destruction" that is essential to improve productivity.

Even China's attempts to foster new, high-tech industries and entrepreneurs may be somewhat counterproductive. By doling out large subsidies in targeted sectors, such as electric vehicles, as well as easy-to-obtain handouts to start-ups, the state, again, is messing around with markets and not allowing truly productive companies to rise to the top. It's telling that China's productivity gains have slumped even as its campaign for innovation and "mass entrepreneurship" has intensified.

The downside of these policies shows itself in another measure called total factor productivity, or TFP, which is the amount of output that is not generated by inputs alone. By the Conference Board's reckoning, China's TFP actually shrank in 2015, which means greater growth of capital and labor are necessary to produce the same amount of goods and services. In that sense, China is losing ground both to the U.S., where TFP grew 0.1 percent in 2015, and other emerging economies, such as India, which witnessed a 1.2 percent advance.

For China, the consequences could be severe. The Rabobank economists fret that feeble productivity gains might ensnare China in the dreaded middle-income trap -- a disheartening deceleration of growth once incomes reach a certain substantial, but not advanced, level. And since China's contributions have loomed large in global economic growth, a slowdown would hurt everyone from iron-ore miners to coffee tillers to French-fry fryers.

To escape such a fate, Rabobank's economists recommend a slate of productivity-enhancing policies, including strengthening human capital by improving education and tailoring the regulatory environment to better support innovation by, for instance, bolstering intellectual property protections. Chinese companies need to spend more on research and development, too. China still trails rivals like South Korea and Japan in the amount invested in R&D, relative to national output.

Of course, what China really requires is the sort of free-market reform that the current leaders in Beijing have been so reluctant to implement. The state needs to allow market forces to allocate money and talent to the country's most competitive and productive industries and companies.

Clear thinking from leading voices in business, economics, politics, foreign affairs, culture, and more.

For the U.S., there is the glimmer of a silver lining. Unless China can lift its productivity, any edge it had over more advanced economies will wither. Boston Consulting Group estimates that when the superior productivity of American workers is taken into account, the costs of manufacturing in China and the U.S. are generally the same. China's failures could make the West's own troubles with productivity a little easier to bear.

This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.

To contact the author of this story:
Michael Schuman at contactschuman@gmail.com

To contact the editor responsible for this story:
Nisid Hajari at nhajari@bloomberg.net

# data[].attributes.attachment_link.title
China Has World's Biggest Productivity Problem

# data[].attributes.attachment_link.description
Just about everybody assumes that China will overtake the U.S. as the world's indispensable economy. One factor, however, could slow its seemingly relentless march and cast doubt on China's prospects for becoming an advanced economy: faltering productivity. Sure, China is advancing daily in wealth, technology and expertise. But nothing is inevitable in economics.

# data[].attributes.headline
Tutor's comments:                                     

# data[].attributes.subject
Tutor's comments:                                     

# data[].attributes.body
A good start, Well Done! You are on the right track. Seems like you have begun some research of China's key economic variables.  However, a few points for you to take note of:
(1) Which NEWS articles would you be using as the basis of your report? You can only have a maximum of 3 news articles and they must all be dated after 31 Jan 2017. Please note they must be NEWS articles (like from The Straits Times, Business Times, Channel News Asia, etc). These news articles will be the platform for your report. Have the full articles (not just the link) on your padlet wall.
(2) To get great marks, write a good analysis of the chosen news articles; do not just regurgitate learning content from PolyMall or from our teaching PowerPoint slides. So you would need to do some further research to analyse the key points in the news articles. Please refer to our evaluation criteria found in the project brief.
(3) You should also have a few relevant graphs and pictures on both your padlet wall and report.

# data[].attributes.attachment_link.provider_name
FocusEconomics | Economic Forecasts from the World's Leading Economists

# data[].attributes.attachment_link.title
China Economy - GDP, Inflation, CPI and Interest Rate

# data[].attributes.body
The GDP of Q1 2017 decreased from 211281300 millions yuan (about SGD$42.7 billion) of Q4 2016 to 180628700 million yuan (about SGD$36.5 billion) , which is a decrease of 14.5%. It is therefore evident that China's economy is slowing down.