70,000 Chinese factories close down – 20 mn migrants unemployed

“Going on the road to Sichuan is as hard as going to heaven.” says a Chinese Proverb.  Well, it seems it was easy to be in heaven all these years – riding on the US economy and large household spending in the other countries… where the Chinese goods used to end up.  Now, that is coming down.

Over the years owing to the manufacturing boom, 120 million farmers had migrated to the cities and were working as labor in the new factories.  Now, 70,000 factories in China have closed down.  And that means 20 million jobs have evaporated.

While the government is offeriing some relief:

Vice Minister of Commerce Jiang Zengwei says China is offering “a one-off subsidy of 100-150 yuan ($15 to $22) to 74 million low-income people … for temporary relief.”

…. there is already a talk of the imminent rural revolution in these bad economic times!

What is not so clearly understood in this entire scenario is that those who lost the jobs are not native of the regions that they now fiind themselves in.. they are basically migrants from the villages or smaller towns… so, unless they are lucky as the guy in the article – to have a piece of land to till – they might have already sold their stuff “back home” to come to the cities.  So, where do they go NOW?!!  Such social displacement could be another recipe for a turmoil.

Reference Links:

1. Road to riches ends for 20 million Chinese poor
2. China’s job losses send 20M migrants home