Investment in China’s New Economy Sectors Shrinks, Caixin Index Shows

The Caixin index showed on Wednesday that the contribution of value-added industries such as biotechnology to China’s overall economic output fell in October due to a drop in capital investment and labor.

Caixin New Economic Index BBD (NEI) 28.5 income Last month, it showed that the newly controlled economic sectors accounted for 28.5% of China’s total economic contribution. The reading level has decreased by 1.8 points 30.3 in September.

A new wave of Covid outbreaks and containment measures have disrupted the world’s second largest economy and affected both production and service activities.

NEI uses big data to track the size of new industries in China. It measures the contribution of labor, capital and technology in 10 emerging industries relative to those used in all industries.

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The decline in the NEI last month was largely the result of a decline in the sub-index for capital inflows. The sub-index, which has a weight of 35%, decreased by 4.4 monthly points in October and reached 32.8.

The sub-index for labor imports also fell and lost 1.9 points in October. This measure, which has a maximum weight of 40%, measures the income of employees and the number of positions in new sectors of the economy.

Meanwhile, the technology input sub-index rose 2.1 points to 29.8 in October. This metric has a weight of 25% and measures the number of research workers employed by the industries tracked, the number of inventions created, and the number of patents granted.

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The NEI, launched in March 2016, defines a new economic sector as one that is technologically and human capital-intensive but asset-light; experiences stable and rapid growth; and strategically encouraged by the government.

Of the 10 industries tracked, the new information technology industry remained the largest contributor in October, accounting for 7.7 points of the NEI reading, although its share was down from 8.3 points the previous month. The contribution of the new energy industry increased sharply by 4.2 points, which was mainly due to the increase in the volume of new enterprises.

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The average monthly salary in the tracking industries was 14,218 yuan ($1,956) in October, up 161 yuan from September, according to data compiled from online career and recruitment websites.

NEI monthly report by Caixin Data Technology Co. Ltd. and Chinese big data research firm BBD were written in collaboration with the National School of Development at Peking University.

Contact reporter Zhang Ziyu ([email protected]) and editor Jonathan Breen ([email protected])

More about Caixin economic indices.

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