China’s poor class faces uncertain future amid slowing economy

New Delhi, Aug 30 (IANS) China’s April 2026 guidelines for platform workers and its switch to consumption-led growth mark early steps in an era of slower growth, but they do not resolve the precarity facing the Communist country’s poor underclass, according to an article in East Asia Forum.

China’s Rural migrant workers and gig economy workers are groups long excluded from full social protections by the ‘hukou’ (housing registration) system and increasingly, by algorithmic labour management.

Whether Beijing follows through with real fiscal redistribution will determine what kind of social contract emerges as the era of high growth comes to a close, the article by Irvan Maulana said.

Notably, the framework does not mandate standardised contracts, capped working hours, algorithmic transparency or full social insurance coverage which are crucial for improving the standard of living of the poor.

“Beyond enforcement, the real question is whether Beijing will commit to the fiscal redistribution that a consumption-led economy demands. With growth slowing to 4.3 per cent in the second quarter of 2026, the weakest reading since 2022, that question has only sharpened,” the article added.

Different but overlapping groups fall under this label of precarity, including platform economy and rural migrant workers.

Many of China’s more than 300 million rural migrant workers work without contracts that would entitle them to full social insurance.

This two-tiered labour market is a direct result of China’s hukou (household registration) system institutionalised in the 1950s, which continues to keep migrant workers from receiving the same benefits as their urban counterparts. While they built the factories, roads and cities which powered economic growth, the basic benefits of livelihood were denied to them.

While platform workers may be local residents with urban hukou, migrant workers’ are trapped within a contracting labour market. They are excluded from better jobs due to their hukou and confined by platform algorithms built to extract maximum hours at minimum costs.

China’s economic growth made precarity tolerable by fostering an expectation that the next generation would join the protected middle class and that the social contract would eventually extend to everyone. The gap between this promise and what the labour market now delivers is the defining social fault line of China’s current moment, the article said.

It highlights that China’s youth unemployment rate for the 16–24 age group stood at 17.9 per cent in July 2026, excluding students.

A record 12.7 million university graduates in 2026 are now entering a saturated job market. And in response to an ageing population, the retirement age was raised in 2025 — the first increase since the 1950s.

In no comparable economy has the end of high growth improved outcomes for the workers who powered it, the article noted.

The April 2026 framework for platform economy workers is an early instalment in a new era of slower growth.

The real test lies in implementation — how effectively these measures protect the rights of the precariously employed, extend insurance coverage, enforce working hour limits and transparently manage platform algorithms.

How fully Beijing follows through on these objectives will define what kind of country emerges from the era that built it, the article concludes.

–IANS

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