With the growth of China’s economy came a host of new jobs, raising millions of people out of poverty. How are businesses cashing in on the now massive lower-middle income demographic?
How is China’s bulging waistline impacting the economy and the country’s health care system?
Last year, China recorded its slowest economic growth in 28 years. But for leading e-commerce player Pinduoduo, it was boom times, with business up 234% for the year thanks to a largely ignored market—China’s vast rural regions and smaller towns and smaller cities, termed “non-first tier cities”.
China’s hospitals are becoming overstretched as population aging and urbanization send demand for health care soaring. But a new wave of world-leading Chinese health technology firms believe they can lift the burden on the country’s frazzled doctors, saving them from the repetitive tasks like reading CT scans. Indeed, the AI health care field has developed incredibly fast in China, with most companies focusing on medical imaging systems that help doctors analyze X-rays, CT scans and tissue analyses for signs of dozens of diseases, from cancers to liver disease.
By 2045, there will be nearly 350 million people in China aged over 65. The rapidly aging society is the legacy of a huge baby boom that was abruptly halted by the introduction of the one-child policy in 1979. Over the long term, this trend threatens to drag on economic growth. There were five Chinese taxpayers for every senior citizen in 2010; by 2030, there will be just two. But for businesses that stay ahead of the demographic curve, there will be big opportunities—another 200 million new customers. Slowly but surely, digitally-savvy seniors are changing the game for brands in China.
Economic changes and government policies are driving millions of China’s migrant workers away from the wealthy coastal regions back to the less developed western regions. The trend is a clear sign that a fundamental change to China’s economy is in progress, as a growth model that lifted more than half a billion people out of poverty starts to slow. From the early 1990s onwards, China’s double-digit GDP growth was fueled largely by the cheap labor provided by people leaving their farms in China’s poorer inland provinces to find work in the factories springing up along the coast. Now this has changed.
For most of human history, integrating a new generation into society has been pretty straightforward: The youngsters were shown what needed to be done, they did it as well as they could (or faced serious consequences if they didn’t), and, over time, earned a place for themselves in society. But things are different now. Executives all over the world have reported that they have difficulty not only managing this new generation but even understanding them. These young employees, their managers say, are responding differently from prior generations to everything, from assignments to incentives. Can managers cope with a new generation?
Traditional offices are disappearing—some are being redesigned to be beautiful spaces that employees actually want to come to work in and meanwhile, humbler versions of the Silicon Valley spaces are increasingly popular too. This year, about 1 million people will work in a co-working space. In ten years, that number will top 1 billion. The co-working idea reflects the trend that companies keep trying to move more of their balance sheet from fixed to variable costs, and the supply of office-less workers keeps rising. So which vision of the future will win out—the palace or the co-working hive?
Do you like to work in a café like Starbucks or do you prefer staying in your cubical at the office? Today, fewer people are working in traditional offices, as most administrative work is either being automated or outsourced to cheaper markets, reducing the need for the in-house typing pools and IT services that once took up a lot of room. Young professionals, instead of being assigned to a desk, like to choose where they sit and work. The ideal place should be comfortable, with an open, cozy coffee-shop style. A boss-less office space is becoming increasingly popular.
A fundamental generational change in attitude is happening: business people in China have started to question lavish banquets with too much bajiu, and new approaches to health and wellness are coming into vogue—particularly among the young, hip and urban. Rising with this trend is a multibillion-dollar fitness and food industry. Fitness apps are being downloaded by the tens of millions, and gyms are popping up almost everywhere you look in major cities. Market researchers predict that the gym, health and fitness clubs industry is to generate $5.81 billion, and that does not include sales of health food, which seems to be a craze all its own.