China’s jobless turn to car boot sales as Covid-hit economy stalls

When the COVID-19 pandemic forced Wang Wei to shut his tourism company, the Tianjin native poured his life-savings of 80,000 yuan ($11,785) into selling coffee from the back of his green Suzuki micro van in the Chinese capital Beijing.

Since June, Wang has driven his mobile coffee booth from car boot fair to car boot fair, offering hand-brewed coffee steeped in an assortment of liqueurs.

Once considered too low-status for many, peddling wares on the street has made a comeback as people who lost their jobs or closed down their businesses seek new ways to make a living and work around China’s relentless anti-COVID policies.

Hospitality, tourism and after-school tutoring have been particularly hard hit.

Wang, 40, gave up a bricks-and-mortar coffee shop in Tianjin in 2020 when the pandemic first hit. Overseas group tours he used to organise also took a blow that year, with a lucrative trip to see the aurora borealis cancelled, costing him hundreds of thousands of yuan in lost earnings.

This year, the spread of the Omicron variant across China was the final nail in the coffin, making his group tours to the Chinese backcountry impossible.

Wang started running his mobile coffee booth this summer, after car boot fairs emerged in big southern cities like Chengdu, Chongqing and Guangzhou. Under a canopy extending from Wang’s van, customers relax in camping chairs, with soft lights in the evening completing the glamping experience.

“The rising popularity of this car boot sale market has helped me tide over the most difficult of times,” said Wang, who reckons he earns about 1,000 yuan a day.

China’s economy barely grew in April-June. Youth unemployment has remained high, reaching a record 19.9% in July, the fourth month in which the rate had broken records.

Pan, 25, closed his bar in Shenzhen after a COVID outbreak in March, saddling him with over 100,000 yuan in debts.

“I was pretty down, and one night, my fiancée Annie, wanting to cheer me up, took me to a watering hole in a quiet area with warm, faint lights and soft music,” he said.

That was when he saw a couple selling liquor at an outdoor stall, inspiring him to do the same - but from his T

“My best friend lent me 3,000 yuan, which became the initial investment for our pop-up liquor shop,” Pan said.

Pan and Annie ran out of money in their first week, but their determination paid off, with daily revenues since climbing as high as 7,800 yuan.

“In the future, we plan to travel the country with our Tesla and sell liquor from the boot of our car in cities we enjoy the most,” said Pan.

Policymakers, in tacit admittance jobs are harder to come by, have encouraged “flexible” employment in the informal economy.

Even Beijing, which has long regarded makeshift market-places as beneath the capital, is closing an eye to car boot sales.

Liu, 30, used to make a living teaching Beijing kids how to solve the Rubik’s Cube, but after in person learning was shuttered due to COVID-19, she became “penniless”.

She now sells coffee from the back of her small van and hopes her small business will pull her out of her financial straits.

“We are still losing money at this stage, I get less than 100 yuan a day most of the time - not enough for meals and transportation,” she said. “But I’m happy just being occupied.”

Unemployment insurance payouts: China’s unemployment insurance payouts hit a record high in June, adding to signs of a struggling labour market as the economy has been badly hit by COVID-19 outbreaks and a property crisis.

Payments by China’s unemployment insurance fund jumped 256.6% in June from a year earlier to 37.19 billion yuan ($5.42 billion), according to Reuters’ calculations based on data from the Ministry of Human Resources and Social Security. That was the highest since the data series began in January 2013.

The surge in the payouts resulted in a deficit of 22.74 billion yuan in the fund in June, widening from a 4.91 billion yuan deficit in May and contrasting with monthly surpluses from January to April.

China’s unemployment insurance fund is pooled from employers, employees and government subsidies, and the spending offers help with the basic needs of the jobless.

The world’s second-biggest economy was impacted by strict COVID-19 curbs this year, which disrupted supply chains and hurt job-creating small businesses.

The youth unemployment rate rose to a record high of 19.9% in July, even as the nationwide survey-based urban jobless rate eased to 5.4% in the same month.

A graduate student based in Shanghai, who only gave his surname Wang, said he had postponed graduation for a year because of the tough job market.