1. Shenzhen State-owned Assets Supervision and Administration Commission (SASAC): we will assist Vanke in responding positively
On November 6, Vanke, in conjunction with both domestic and international financial institutions, held a briefing regarding their third-quarter results. The meeting included Vanke’s leadership, as well as shareholders Shenzhen Metro and the Shenzhen State-owned Assets Supervision and Administration Commission.
During the session, the Shenzhen State-owned Assets Supervision and Administration Commission (SASAC) emphasized Vanke’s crucial role within Shenzhen’s state-owned assets framework. They assured the availability of ample funding and resources in the event of an extreme situation, affirming support for Vanke through all feasible means.
Amidst concerns sparked by defaults in debt among private real estate companies, apprehension about the industry’s future has impacted both mixed and centralized state-owned enterprises, causing fluctuations in real estate sector bonds and share prices, including those of Vanke.
Although Vanke has refuted rumors regarding fundamental company issues, skepticism has persisted, compounded by rumors about dollar-denominated debt affecting Vanke’s stock price, resulting in a six-year low.
The volatility in stock prices and bonds prompted Vanke to seek intervention from Shenzhen Metro and the Shenzhen State-owned Assets Supervision and Administration Commission to dispel any rumors.
The statement regarding the potential intervention of the Shenzhen State-owned Assets Supervision and Administration Commission in case of Vanke’s distress carries significant weight.
Vanke has been a model in the real estate industry for actively reducing leverage, even proposing a life in 2018. If a powerhouse like Vanke struggles to recover, the future prospects for the revival of private real estate enterprises appear bleak.
Certain industry analysts suggest that foreign entities may be maliciously shorting Vanke. In essence, exploiting China’s real estate downturn and Vanke’s dollar bond crisis to profit from shorting. The timely support from Shenzhen’s State-owned Assets Supervision and Administration Commission is crucial for restoring market confidence amidst these challenges.
2. Double 11 consumption data reveal that for the first time without in-time GMV with a rising “HE” economy
According to the latest Tmall Double 11 Consumer List, men’s purchasing power is increasing for the first time ever, contributing to bicycle gaming products, and mountain wearings
The most recent data highlights a notable shift in male consumer trends, with road bikes, gaming products, and assault vests emerging as the top three favored items, referred to as the “new three treasures” for men in 2022. This marks a transition from the previously dominant choices of Moutai, fishing, and ARCTERYX. In 2022, bicycle sales doubled year-on-year, particularly with a significant 300% surge in road bike sales. The male user base also notably increased by nearly 100% during this period. Additionally, assault jackets observed a 90% increase in sales, while gaming products emerged as the biggest winners during the Double 11 sales event.
Major brands have directed their prime offerings toward female consumers, while the children’s consumer segment also garners significant attention from various brands. However, the male consumer group is often characterized as having lower consumption frequency, limited interest in consumer goods, and less inclination to spend. In the dichotomy of the “her economy” and “his economy,” brands are inclined to favor the former.
While certain product categories like cosmetics, clothing, and bags primarily cater to female consumers, food and beverages also lean heavily towards this demographic. The marketing focus on women stems from the perception that they are more emotionally driven and responsive to products that tap into their emotional values, reinforced by the understanding that women typically spend more time shopping than men.
Although there’s been an observable increase in men’s willingness to invest in themselves over the past couple of years, the fact that men’s spending power only exceeds that of pet dogs seems to indicate a limited change in the overall scenario.
Furthermore, during this year’s Singles’ Day shopping festival, Alibaba Group Holding and JD.com saw sales growth but chose not to disclose specific revenue figures for the second consecutive year. This decision aligns with the ongoing challenges related to China’s fluctuating economic recovery and intense price competition. The absence of published sales numbers may reflect a consumer base that values practicality and cost-effectiveness over brand premiums, signaling a shift towards more rational purchasing behaviors.
3. The rest of the world is suffering inflation, while China is in deflation indicated by the drops of October’s CPI and PPI?
In October 2023, the Consumer Price Index (CPI) for residents across China shows a 0.2% year-on-year decline, marking the second contraction this year. The CPI figure for urban areas indicated a decrease of 0.1% and rural areas, while rural areas saw a decrease of 0.5%. Of these, food prices fell by 4%, non-food prices rose by 0.7%; consumer goods prices fell by 1.1%, and service prices increased by 1.2%. On average, from January to October, the national consumer price index increased by 0.4% compared to the same period last year
On a month-to-month basis, both urban and rural areas saw a decrease of 0.1%; food prices fell by 0.8%, non-food prices remained steady; consumer goods prices fell by 0.1%, and service prices increased by 0.1%. This dip is primarily attributed to a notable decrease in food prices, which fell by 4.0%, impacting the CPI by approximately 0.75 percentage points. The significant drop in pork prices, by 30.1%, particularly contributed to this decline. Other food items, including eggs, beef, mutton, fresh vegetables, and edible oils, also experienced price reductions ranging from 3.5% to 6.4%
The decline in CPI is likely linked to reduced consumer demand after the Mid-Autumn Festival holiday and lower agricultural product prices due to increased supply. Furthermore, the challenging global context has encouraged higher savings to bolster resilience against global uncertainties.
On the other hand, China’s Producer Price Index (PPI) recorded a 2.6% year-on-year decline in October, slightly widening from the previous month. This marks the thirteenth consecutive monthly decline, although the rate of decline was slightly smaller than anticipated. Within industrial producer purchases, construction materials, non-metals, fuels, power, chemical raw materials, and agricultural products saw significant price drops. However, non-ferrous metal materials and wires experienced a 3.7% price increase
The recent data signals a return to deflation for China’s economy in October, following a brief respite. Unlike developed economies like the US, which have concentrated on managing and reducing inflation, China has struggled to elevate inflation for the majority of the year. Despite the introduction of various economic stimulus measures by the Chinese government, the latest figures on the Consumer Price Index (CPI) and Producer Price Index (PPI) underscore a notable weakness in domestic demand.
Interestingly, the data suggests that China’s economy isn’t as susceptible to the volatility in energy prices amidst tense global situations, such as the Palestinian-Israeli conflict. This could indicate a certain resilience within China’s economic structure, potentially due to diverse factors and internal dynamics that shield it from external energy price fluctuations.
4. Artificial Intelligence Talent Insights 2023: Average salary for newly posted AI jobs exceeds RMB 46,000
Pulse High Hire Talent Think Tank has unveiled the 2023 Pan Artificial Intelligence Talent Insight, revealing significant insights into the AI job market. From January to August 2023, newly issued AI job roles carried an average monthly salary exceeding 46,000 yuan. However, the ratio of talent supply and demand was starkly imbalanced, with only 0.39, implying that for every two available talents, five job positions competed.
The pure Internet industry stands out as the sector generating the highest number of new AI job roles, constituting 20.78% of the total. Insight employs meticulous screening based on AI job tags to glean underlying analysis data. For “AI talent,” positions or resumes are identified by keywords such as AI, algorithms, data, deep learning, and natural language processing. Meanwhile, “AIGC talents” are characterized by job roles or resumes featuring keywords like AIGC, lexical annotation, sentiment analysis, grammatical rules, and semantic analysis.
The findings underscore a widening gap between the supply and demand for AI talent, intensifying the talent shortage. In 2022, the supply-demand ratio for AI talent stood at 0.63. However, by January to August 2023, this ratio plummeted to 0.39, indicating a dramatic increase in competition with five positions vying for every two available talents.
Within the top 10 roles experiencing the most acute shortage, intelligent driving system engineers held the foremost position, with a talent supply-demand ratio of 0.38. Notably, the surge in demand for ChatGPT researcher positions in 2023, triggered by the advent of advanced AI models, propelled it into the list of top 10 roles facing substantial scarcity
During January to August 2023, the quantity of newly released AI job opportunities has already matched the entirety of 2022. Within the realm of specific roles, algorithms stand as the cornerstone of artificial intelligence, significantly influencing the level of intelligence. Algorithm engineers, thereby, shape the developmental ceiling for AI enterprises. Among the in-demand positions in the AI landscape, the need for roles centered around algorithms remains robust.
Notably, algorithm-related roles hold a dominant presence among hot jobs in AI, with algorithm engineers accounting for 46.45% of new job openings. Following closely, natural language processing roles constitute 11.04% of the new jobs, securing the second spot in the sphere of sought-after positions. Additionally, the role of algorithm researcher, capturing 5.36% of new job openings, ranks fifth among the highly demanded roles.
The surge in AI technology application across intelligent driving and robot manufacturing has propelled positions such as image recognition/computer vision (6.68%) and intelligent driving system engineer (5.27%) into high demand within the job market
In the past two years, the landscape of artificial intelligence jobs has seen a significant surge in average salary levels, largely driven by the dynamics of supply and demand. The average salary for newly introduced AI roles in 2022 was recorded at RMB 43,817. By the first eight months of 2023, this figure escalated to RMB 46,518, marking a notable increase of 6.16%.
Core technical positions within AI, such as Artificial Intelligence Engineers, Algorithm Researchers, and Big Model Algorithm Engineers, have witnessed a substantial rise in average salaries over this period. For instance, the average salary for newly listed Artificial Intelligence Engineer positions surged from RMB 57,433 in 2022 to RMB 62,911 in August 2023, signifying a significant increase of RMB 5,468 or 9.5%. This elevation positions it as the job type experiencing the highest average salary growth within the AI industry. Following closely, roles like Algorithm Researchers (with an increase of RMB 4,397) and Deep Learning (up RMB 4,204) have also seen notable salary increments.
Lv Xinwei, an innovation and entrepreneurship mentor at Tsinghua University’s Institute for Advanced Study and former director of global high-end recruitment at Huawei, expressed that the AI era presents an opportunity akin to the transformative “20 years of the Internet.” Xinwei believes that most individuals stand to benefit from technological advancements as long as the value they generate surpasses the cost incurred by the company, securing them from replacement. Additionally, Xinwei highlighted the inadequacy of machines in comparison to humans in tasks involving independent thinking, curiosity, empathy, and other forms of awareness, underscoring these attributes as the focal point for improvement in the evolving workplace.
5. Karaoke(KTV)’s declining popularity is plain to see
The decline of the once-thriving KTV industry has raised concerns as more establishments close their doors. Data from Aiqicha on November 10 revealed a stark reality: among nearly 68,000 karaoke businesses in China, the majority listed on the initial pages are either canceled or dissolved. Less than half, totaling 26,917, remain operational. In the past year, a mere 125 new karaoke venues were registered across 31 provinces and cities, indicating a lack of fresh entrants into the industry, further affirming the visible downward trend.
KTV’s emergence traces back to the late 1980s when it captivated people with its novelty and allure. However, over time, the industry lost its luster, especially among younger demographics. This abandonment is linked to several key factors:
- Entertainment Diversity: As society advanced, entertainment options diversified. Younger generations have access to various alternatives like movies, parties, bars, and gaming, surpassing the simplistic appeal of KTV.
- Shift in Spending Patterns: Once deemed high-end, KTV required significant spending. Today’s youth prioritize affordability and value, opting for more cost-effective entertainment.
- Socialization Evolution: Online platforms now drive social interactions, enabling self-expression and connection. KTV’s social function appears outdated compared to modern online channels.
Notably, what was once considered high-end entertainment has been stigmatized as outdated and low-end by young individuals. This shift has severely impacted KTV businesses. In the past, KTV operations could yield quick returns, but since 2015, businesses have faced sluggish performance, requiring several years to break even or face closure.
This decline in the KTV industry underscores a cultural shift as newer, more diverse, and technologically integrated forms of entertainment overshadow the once-popular karaoke culture.