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The View | To revive confidence in China’s economy, clear and reliable data is essential
- Frankness about the nature of the difficulties an economy faces is a virtue, and it can benefit everyone from policymakers to employers and jobseekers
- It is better to be transparent with the data as not doing so could make economic recovery harder than it otherwise might have been
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Why you can trust SCMP
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No one likes bad news. It can ruin a morning. It changes how we think about our targets, goals or strategies, be they personal or business. Hearing bad news makes one think, as we complained as children, “that’s not fair”. But as my mother used to say, “life isn’t fair.”
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People and businesses across China face many sources of worrying economic news today. Whether it is the price of a flat, the plans of university-educated young people or shifting business decisions, this news involves sectors essential for the economic turnaround for which China and its trading partners are hoping.
Yet when times are tough, frankness about the nature of economic difficulties a country faces is a virtue, not something to be obscured. Political leaders will spin the news and what the economic data means to provide the best possible picture. That is normal.
What leaders, economists, policymakers and central bankers should not do is hide reality or shy away from the data that illuminates the real story as it unfolds. Unfortunately, at this juncture that appears to be what is happening to some key data in China.
For example, official youth unemployment data is currently unavailable after a series of high numbers appears to have moved China’s economists to stop releasing the numbers and recalibrate. If this data remains unpublished, it will obscure the reality faced by many job applicants, which will have distortive effects.
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Job applicants might get the wrong impression of the market, holding out for an information technology job they want instead of the manufacturing job that needs filling. Obscuring unemployment numbers also makes life harder for CEOs. Planning business growth strategies when a firm does not know the state of the job market undermines its ability to forecast and adjust accordingly for demand shifts and new opportunities.
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