Chinese factory worker Liu Shengzun lost two jobs in April as U.S. tariffs surged, forcing shutdowns at a Guangdong lighting plant and a shoe factory. Though a recent tariff rollback has helped calm fears of widespread layoffs, Liu has abandoned the search for factory work and returned to subsistence farming in his rural hometown, reports Reuters.
“It’s been extremely difficult this year to find steady employment,” said Liu, 42. Once earning 5,000–6,000 yuan ($693–$832) a month, he now has no regular income. “I can barely afford food.”
The easing of U.S.-China trade tensions after high-level talks in Geneva last week helped Beijing avoid a worst-case scenario: mass layoffs that could have threatened social stability. But economists warn that despite lower tariffs, lasting damage from the earlier hikes — which peaked at 145% in April — continues to strain China’s economy.
“Factories will be able to restart operations and there will be no mass layoffs,” said a policy adviser familiar with the discussions. “But a 30% tariff is still painful.”
Even with the reduction, tariffs remain high enough to challenge export-driven sectors. Economists estimate current duties could cost China 4–6 million jobs, while earlier projections feared up to 9 million. China’s 2025 GDP growth may also slow by as much as 1.6 percentage points under present conditions, according to estimates by Natixis economist Alicia Garcia-Herrero.
Employment remains a top priority for Beijing. The central government is increasing public investment in labor-intensive infrastructure projects and has instructed the People’s Bank of China to provide low-cost funds to sectors like healthcare and elder care.
Jia Kang, president of the China Academy of New Supply-Side Economics, noted that government spending will be key to stabilizing employment in the absence of strong private sector confidence. “Corporate investment enthusiasm has yet to rise,” he said.
Yet instability persists. Chinese exporters remain wary of unpredictable U.S. trade policies under President Trump, who could raise tariffs again. That uncertainty continues to stall hiring in key industries.
Li Qiang, who lost his job at an export intermediary for industrial parts, now drives for a ride-hailing app in Chengdu. “Trump’s policies toward China could change at any time,” he said. “I don’t plan to go back to the export sector.”
As Beijing tries to cushion the blow, many displaced workers like Liu and Li are shifting to informal or lower-income jobs. While mass layoffs have been averted — for now — the broader employment outlook remains fragile amid ongoing trade and economic uncertainty.
Bd-pratidin English/ Jisan
