As China’s economy continues to struggle due to uncertainty stemming from the coronavirus pandemic, unemployment continues to rise in mainland China and thousands of small-businesses are struggling to keep their doors open. The cumulative effects of these problems will seriously impact China’s GDP and scars will remain long after this pandemic is over. Since the beginning of the pandemic in January, China’s businesses, like many other businesses around the world, have been struggling with the lack of customers and revenue.
Small businesses, in particular, have been hit the hardest in China and according to Laura He’s article, “Small Businesses Drive China’s Economy. The Coronavirus Outbreak Could be Fatal for Many” on CNN, “A third of roughly 1,000 small and medium-sized companies surveyed by academics from Tsinghua University and Peking University last week said they could only survive for a month with the cash they have” (He). With this dramatic decline in income, these small businesses have been forced to take drastic actions to save money and pay whatever debts they have.
Unfortunately, this also includes firing workers and according to Evelyn Cheng’s article on CNBC, “Roughly 5 million people in China lost their jobs amid the outbreak of the new coronavirus in January and February” and “China’s official, but highly doubted, urban unemployment rate jumped in February to 6.2%, its highest record” (Cheng). Between the lack of consumerism from unemployed workers and lack of revenue from small business, China’s GDP is expected to plummet because “About 30 million small and medium-sized businesses contribute more than 60% of the country’s GDP” (He). Despite their size, China’s economy relies on its small businesses and they represent the backbone of the nation’s national wealth. It is only a matter of time before this virus scare passes, but China’s economic future will still be up for debate when that time comes.