In recent years, many urban rail transit companies in China have been operating at serious losses, leading to a wave of salary cuts. Currently, Shanghai Metro has initiated a downsizing plan, targeting middle-aged employees in their forties and fifties. The survival pressure on front-line workers is continuously increasing.
Shanghai Shentong Metro’s veteran employee Li Xin (alias) told Dajiyuan that the compensation for this round of downsizing is divided into three tiers:
Li Xin admitted that the compensation amount may seem substantial, but for middle-aged employees in their forties and fifties, it is difficult to find suitable employment after being laid off. In a city like Shanghai, this compensation can barely support a livelihood for about three years, and social security contributions still need to be paid by individuals.
He also revealed that company leaders mentioned that as subway train technology advances, many lines of the Shanghai Metro will gradually become driverless by 2028, leading to a large-scale layoff of outsourced workers and station staff.
At the same time, Shentong Metro implemented salary reductions starting from July.
Upon hearing the news of the downsizing, some colleagues felt complex emotions, Li Xin said. For those who are married and have mortgages and car loans, the pressure of being unemployed is particularly great. The so-called new “three professions” on the internet, such as ride-hailing, food delivery, and express delivery, cannot alleviate the economic pressure of mortgages and car loans.
Shentong employee Zhang Hao’s (alias) wife is already unemployed at home. When he informed his wife that he might be laid off by the end of the year, she broke down, leading to arguments between the two over mortgage, car loan, and their child’s training fees.
“The situation of both spouses being unemployed is the worst,” Li Xin said. He bluntly stated that this wave of unemployment is more severe than the 1998 wave of layoffs. With the decline of the Chinese economy, the situation of downsizing and salary reduction is severe, and there is also a serious downgrade in consumption, leading to a significant decrease in subway passenger traffic.
Li Xin disclosed that since the lifting of the epidemic in 2023, the Shanghai economy has been in a prolonged downturn. Over two years ago, the economy of Shanghai was already struggling, with landmarks such as the Landmark Plaza in Nanjing Road and Meilong Town Plaza closing down, along with Pacific Department Store and the Sixth Department Store in Xujiahui. “On the line where I work during weekday morning rush hours, the number of passengers has decreased by a third compared to before the epidemic, and this year there has been a further decline in passenger flow.”
Recently, Li Xin visited a large shopping center next to a station. During the lunch hour, only bubble tea and fried skewer stalls had customers, while Japanese cuisine, steakhouses, and even Pizza Hut were nearly empty. “This is a true reflection of the shrinking consumption in Shanghai in 2025.”
For more than twenty years, the subway has been considered an important symbol of measuring the level of modernization of a city. Various regions spared no expense to vigorously construct new lines in their race for achievements. However, with debts piling up and consecutive deficits, the subway has become a heavy burden on public finance.
According to a report by NetEase’s public account “Urban Finance and Economics,” in 2024, the profits of subway systems in various Chinese cities mainly relied on government subsidies, with at least 26 city subways still experiencing losses after deducting government subsidies.
Even the most profitable Shenzhen Metro saw a net loss of 33.4 billion yuan in 2024, equivalent to nearly 1 billion yuan in losses per day. Beijing Metro, which had the highest passenger flow nationwide, still incurred a loss of 21.6 billion yuan that year. Qingdao Metro incurred losses of 8.8 billion yuan, Chengdu nearly 7 billion yuan, and Ningbo 7.5 billion yuan. The total debt of the 28 subway companies nationwide has exceeded 4.7 trillion yuan.
The main reason for the subway’s lack of profitability is the high construction costs. For example, the construction cost of Shanghai Metro Line 19 is as high as 2 billion yuan per kilometer, far exceeding the construction costs of other subways. Additionally, blind expansion and high operating costs are also contributing factors.
Wuhan once held hope for the Transit-Oriented Development (TOD) model of “stations + surrounding land comprehensive development.” However, with the collapse of the real estate market, drastic reduction in land transfer fees, and local governments burdened with massive debts, this model is unsustainable.
Analysts believe that as local government subsidies become unsustainable, and passenger flows fail to recover, the era of profitability for subways is gradually coming to an end.