In Shanghai, the financial center of China, Mr. Chen (Xiao Chen, pseudonym), who works at a private equity firm, lamented to BBC News that he regrets choosing his career path. Describing this year as extremely difficult, he remarked that the glamour of the industry has faded, labeling him and his colleagues as “finance rats” in online mockery.
During his first year at work, Mr. Chen earned nearly 750,000 RMB (approximately $106,200 USD). Initially optimistic that his income would soon surpass the million-yuan mark, three years later, his earnings have only reached half of that initial amount. Last year, his salary was frozen, and the annual bonus, a significant part of his income, disappeared.
Three years ago, Chinese leader Xi Jinping initiated the “common prosperity” campaign aimed at narrowing the wealth gap. Oppressive measures by the Chinese government towards billionaires and businesses in various sectors, including real estate, technology, and finance, have led to layoffs, salary cuts, and recruitment freezes. This has not only failed to achieve prosperity but has exacerbated poverty, turning the dream of “common prosperity” into a reality of “common poverty,” as noted by former investment banker and Bloomberg columnist Shuli Ren.
Mr. Chen’s lifestyle has undoubtedly been impacted by this shift. He replaced European vacations with more affordable options in Southeast Asia, even shunning luxury items from brands like Burberry and Louis Vuitton.
Since last year, deflation has been a persistent issue in the Chinese economy, now showing signs of spiraling deflation, posing risks of deteriorating economic prospects.
Pay cuts in banks and investment firms have become a hot topic on Chinese social media, with millions of views on posts discussing wage reductions. Tags like “transitioning out of finance” on platforms like Xiaohongshu have garnered over 2 million views.
Mr. Chen revealed that as the number of companies issuing stocks in the stock market decreases, his workload has significantly reduced. Foreign investment in China has decreased due to government crackdowns and weak consumer demand, leading domestic companies to exercise caution.
His work, which once involved sourcing new projects to bring in funds for the company, now mainly entails mundane tasks such as organizing data from previous projects on a daily basis. Morale within the team is low, with discussions behind the boss’s back mostly negative, focusing on uncertain future plans years down the line.
On Xiaohongshu, a user likened changing jobs to changing seats, emphasizing the risk of losing one’s place if they stand up.
The plight of Chinese financial professionals has garnered widespread attention from foreign media. Bloomberg reported in September that the economic policies of top Chinese leaders in recent years are brewing a crisis, shattering the dreams of high earners and dampening their job enthusiasm, which could potentially lead to a broader social crisis, according to experts.
At 1 a.m., 43-year-old insurance executive Thomas Wu rode his bicycle through the deserted streets of Shanghai, once again on the brink of breakdown. As part of a nationwide initiative by state-owned financial companies to reduce salaries, Wu’s pay was slashed by 20%. Worried about potential layoffs within the company, he grapples with how to raise 600,000 RMB (approximately $84,500 USD) to continue sending his two children to an international school.
“Salary increases are no longer tied to the effort put into work. My job feels meaningless,” he expressed.
Tracy, a worker at a Beijing securities firm, told Bloomberg, “We feel like rats on the street, being beaten by everyone. This country doesn’t seem to value its financial talent.”
The demoralization and loss of motivation among some of the most outstanding and intelligent workers could potentially worsen the shadows looming over the Chinese economy.
Christopher Marquis, a professor of Chinese management studies at the University of Cambridge, highlighted, “This indicates a dangerous undercurrent within China’s workforce. These individuals were once the main drivers of the Chinese economy, but their shattered dreams could lead to a broader social crisis.”