Wages offered to Chinese workers in major cities declined by the most on record, underscoring persisting deflationary pressures and sluggish consumer confidence across China, reports Bloomberg, citing data from Zhaopin. Average salaries offered by companies to new hires in 38 key Chinese cities fell 1.3% to RMB 10,420 (USD) in the fourth quarter of 2023 from a year ago. This was the worst drop since at least 2016. It’s also the third straight quarter of decline, the longest run since data on yearly changes were first available in 2016.

China has seen widespread salary cuts in various sectors this year including technology, finance and among local government workers due to regulatory crackdowns and strained public finances. Beyond that, companies are also under pressure from weak domestic and overseas demand for their products. In Beijing, the wages decreased 2.7% from a year ago in the fourth consecutive quarter of contraction. Salaries in the southern metropolis of Guangzhou fell 4.5%.

The data highlights the mounting deflation risks faced by China going into 2024, which weigh on its growth outlook. A gloomy job market means residents could pare back their spending, adding to downward pressure on consumer prices that are already falling at the steepest pace in three years.