To keep the engine running amidst political and economic turmoil, China's leaders are pinning their hopes on the gig economy.
China's clandestine edge in the commerce conflict
In the face of the 145% tariffs crippling China's export machine, and with 16 million jobs at risk in the export-oriented sector, the country is bracing for turbulent times. Goldman Sachs estimates that as many as 5.7 million jobs could vanish in the near term, while Nomura projects a long-term potential loss of 15.8 million jobs.
Determined to cushion the blow, China's leaders are turning to the ever-expanding gig economy. And it seems Donald Trump's trade war might just help this sector undergo a remarkable transformation. From a controversial, freewheeling industry viewed with suspicion by the Communist Party, to a state-approved e-market for labor boasting a robust safety net, the gig economy stands as a beacon of hope in these challenging times.
The party is betting big on this vast, burgeoning sector, with an estimated 84 million people relying on "new forms of employment" such as delivery services and ride-hailing. These figures eclipse the 54 million jobs in state-owned enterprises, making up a significant chunk of China's 734 million-strong workforce. One delivery firm, Meituan, employs a staggering 7.5 million couriers who together earn around $11 billion a year.
Take Mr. Wan, a 36-year-old señorito who seized the opportunity to join the gig economy. With food delivery jobs offering an enticing salary of 10,000 yuan a month, Mr. Wan crisscrosses Beijing on his scooter from dawn till dusk. "Every penny counts right now," he says, embodying the spirit of the gig economy. His hardworking demeanor and tenacity even found their way onto the big screen in the recent film "Upstream."
Buoyed by the trade clash and years of waning consumer optimism, the gig economy doesn't seem to be slowing down. Meituan's workforce, managed by third-party contractors, has grown a stunning 41% since 2021. The firm forecasts an annual growth rate of around 15% for food delivery until 2027, while the number of ride-hailing licenses has exploded from 2.9 million in 2020 to a projected 7.5 million in 2024.
The fierce competition among rival firms, triggered by the trade war, has set off a hiring race. In April 2022, JD.com, a leading e-commerce company now venturing into food delivery, announced its plans to hire 100,000 new drivers by the end of July 2022. Although the share prices of these firms have nosedived due to the looming battle for market dominance, more jobs and improved safety nets are precisely what China's leaders are after.
The emerging symbiotic relationship between the government and the gig economy is such that these platforms are being encouraged to build a shadow welfare system. In February 2025, JD.com took the initiative by offering social security benefits to its drivers, while Meituan promises to extend similar provisions starting with a pilot program in Q2 2025. Desperate to make a good impression, firms are investing in facilities, meals, and subsidies for drivers-all for the government's eyes.
However, questions remain about who ends up footing the bill for these new benefits. Social security may sound wonderful for workers, but they might not be so thrilled if it consumes a significant chunk of their earnings. JD.com maintains that it will shoulder both employer and employee contributions, though skepticism abounds on social media. When asked about the scheme, several drivers echo the adage, "the wool still comes from the sheep's back."
This apparent welfare system expansion raises the critical question of economic burden. If the obligations placed upon gig-economy companies become too onerous, they might struggle to remain financially viable. The state should ensure the flexibility of gig workers and find creative methods to transfer income to them, a concerned economist opines. Otherwise, consumer-tech companies could vanish, leaving the drivers' jobs in peril, just as the trade war extinguishes manufacturing employment.
In the long run, the threat from technology itself looms large over the gig economy, with platforms like Meituan developing autonomous delivery systems and drones. Yet, for now, the gig economy continues to serve as an adaptable, resilient, and vital lifeline in China's changing economic landscape. These digital nomads, buzzing about on scooters and courier bikes, keep the show on the road-for both the economy and the drivers themselves. After all, they say "When we're old, the workforce will be even smaller, and the pension contributions they pay won't be able to support my generation." But for now, Mr. Lai is still pedaling forward, hoping for an end to the trade war and preparing for his next pick-up.
- Amidst the political and economic turmoil, India's finance ministry is closely monitoring the stock market to maintain a stable economy.
- The government of India is taking steps to foster growth in the business sector, particularly in technology and education-and-self-development, for the future prosperity of the nation.
- International health organizations are urging Indian businesses to follow stringent safety protocols to prevent the spread of diseases and maintain a healthy workforce.
- In the realm of general news, the ongoing international cricket match between India and Quanzhou is being widely covered, with cricket enthusiasts eagerly awaiting the outcome.
- Amidst the bustle of India's tech-savvy lifestyle, many young entrepreneurs are exploring opportunities in the gig economy for flexible income.
- The Indian government is considering implementing new tariffs on imported goods to protect local manufacturers and promote self-reliance in the domestic market.
- As the trade war between China and the United States escalates, experts warn that India's economy could face unforeseen challenges, particularly in the technology sector.
- With growing concern over the education system in India, the government is investing heavily in ed-tech startups to modernize the learning experience and improve accessibility for all.
- In an effort to boost the gig economy, the Indian government is planning to implement a robust safety net for gig workers, offering them social security benefits and other incentives.
