Peter St. Onge
China is on the edge of recession — excluding Covid, for the first time since 2008 — as new data showed all-important manufacturing contracted for the fourth month in a row with particular weakness in new orders.
In other words, what they’ve got is a backlog, then it’s a cliff.
Manufacturing makes up a third of China’s economy — much more than the US. The collapse of China’s property — another third of China’s economy — is adding further fuel to the fire.
Offices Emptier than Covid
London’s Financial Times reports that office buildings in China are emptier than they were during the Covid lockdowns. FT notes that work-at-home hasn’t taken off in China, implying the main driver of empty offices is layoffs.
In Shanghai, office vacancies are at 21%. In Shenzhen, China’s central export hub, vacancies are at 27%. These are both much worse than vacancies during Covid lockdowns.
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