China losses of jobs due to US tariffs have alleviated since the Geneva negotiations, but the economic suffering persists. Workers such as Liu Shengzun continue to feel the repercussions of previous trade shocks. Factories are reviving hesitantly. But numerous former workers remain unemployed or resort to farming and gig economy work.
Although the US tariff reversal averted en masse dismissals, persistent tariffs and economic uncertainty encumber China’s export-oriented industries. Experts predict the recovery of jobs will be weak and irregular.
Workers Move from Industry to Survival
Liu Shengzun lost two factory jobs in April. US tariffs rose to more than 100%, biting factories in Guangdong severely. A lighting products company and later a shoe factory laid him off. Without regular work, Liu now tills the land in his hometown. He earned 5,000–6,000 yuan ($693–$832) per month before. Now, he just about manages to buy food.
“It’s been extremely difficult this year to find steady employment,” he said.
Geneva Talks Assist, But Damage Is Done
Geneva talks lowered tariffs. This prevented China from suffering wide-scale job losses. The Communist Party government viewed it as a success. It reduced pressure on social stability, which is still its most important concern. One policy adviser said factories will resume production, and layoffs will ease. But the remaining 30% US tariffs continue to hurt.
It’s hard to do business at 30%,” the adviser cautioned. “Eventually, it will weigh on China’s growth.”
Layoff Numbers Decline, But Risks Remain
Economist Lu Zhe puts jobs at risk at below 1 million from a potential 6.9 million prior to the negotiations. Natixis’s Alicia Garcia-Herrero had previously estimated 6–9 million job losses in case of triple-digit tariffs. Existing rates may still lead to 4–6 million job losses.
In case the US reduces tariffs by an additional 20%, 1.5–2.5 million jobs may still disappear. She estimated China’s growth in 2025 could slow by 0.7 to 2.5 percentage points based on future tariffs.
Export Sector Under Deep Uncertainty
Before Geneva, Chinese factories indicated an increase in bankruptcies in sectors such as furniture and toys. Beijing acted swiftly. But most exporters are still reluctant to hire back. Garcia-Herrero does not believe a 30% tariff is enough to make it worth hiring.
“Perhaps the Chinese government would call this a success. But businesses are not so sure,” she said.
Government Compels Public Sector Employment
China is increasingly resorting to state-sponsored job creation. The central bank initiated tools to finance services and age care. Jia Kang, an economist, stated government investment, rather than business sentiment, will spur new jobs. Beijing will maintain its budget deficit at close to 4%, but can raise it in case of necessity.
A recent poll indicates factory employment fell in April. Commentators believe Beijing was more apprehensive about the speed of job reduction rather than precise figures. Companies had already reduced employment to remain competitive. “It’s just frost on snow,” a policy adviser said, describing the soft economy.
Workers Exit Export Sector
Most of the laid-off employees won’t be back. Li Qiang was let go from a company that exported pneumatic cylinders. The company went under after losing US orders and Japanese market share. He now works for a ride-hailing service in Chengdu.
“Trump’s China policies can change at any time,” said Li. “I won’t work in exports again.
