About this programme by Peter Day
When the Credit Crunch started ricocheting round the world, there were hopes that in some not very spelled-out way, Asia might be immune, keeping the global economy afloat while the West (or the once rich world, or whatever we will learn to call it) collapses into recession.
If that were ever plausible, it now seems rather unlikely.
How could an export-based economy such as China’s avoid the impact of what is now happening all over the world?
Think back 10 years, and the appetite of American consumers was the phenomenon that enabled Asia to have a short sharp shock of a crisis when that investment bubble burst.
This time, though, there is no consumer of last resort in sight to go on spending as conventional importing countries get cold feet or even pneumonia.
So China is in for a hard time; or rather, some parts of China are. In 2009, China celebrates the Lunar New Year on and around January 26th, with that extraordinary mass migration of millions of people back to their home town or village for what is also called the Spring Festival.
But this time the migration has started very early. In the bus and railways stations in China’s most vibrant industrial areas in December, you could see tell-tale huddles of people with string tied packages, waiting for a bus or train.
They said they were going home early for the Spring Festival. They said they had lost a job or a factory had closed. Plants shut fast in China; open at lunchtime, closed down in mid afternoon.
In some places there have been angry demonstrations by workers cheated of their pay-off money. But not (as far as I know) mass demos of laid-off workers of the kind seen in rustbelt state-owned industries ten years ago.
As a foreigner with a microphone, I didn’t encounter resentment, just bemused acceptance, and a hope that things will improve in the New Year.
These millions of migrant workers, who often have few rights in the cities they have flooded into, are now taking the strains in the Chinese economy.
They have travelled hundreds of miles to seek work that pays better than the pittance they can earn in the countryside, but when times get suddenly hard (as they are doing now) back home is where they go, to an uncertain existence.
The vast Chinese industrial revolution of the past 30 years has been engineered by the authorities to lift people out of poverty by a huge provision of jobs in cities, creating a mighty export machine.
Year after year something like 10 million people have made the move from the countryside, a migration never seen on that scale before, anywhere.
Life is still hard in the cities; many migrants are unofficial, with few rights to services such as education for their children, who remain back home. They are prey to exploitation. And there is unsubtle class distinction, so that migrant workers keep that status even if they’ve been city folk for 10 years or more.
These people are the buffers of the world economy, and their not uncheerful docility disguises their plight.
Leading Chinese economists are now talking of the need for the country rapidly to develop a consumer society that will need some of the goods produced in the hundreds of thousands of factories built for the export markets.
But the Chinese save huge sums of money because of the huge uncertainties they have lived through in the recent past; it will take a long time to turn them into enthusiastic buyers of the things the west cannot resist.
When it happens, the rise of the Chinese consumer will be an economic happening just as remarkable as the rise of exporting China that we have seen in the past three decades. Maybe much more so.
But it will not lessen the deep uncertainties of the coming Spring Festival, when going home means a trek back to poverty for workers who pinned their hopes a job in the city, now eaten up by the global credit crunch.
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About In Business
We try to make ear-grabbing programmes about the whole world of work, public and private, from vast corporations to modest volunteers.
In Business is all about change. New ways of work and new technologies are challenging most of the assumptions by which organisations have been run for the last 100 years. We try to report on ideas coming over the horizon, just before they start being talked about. We hope it is an exhilarating ride.
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