Some Chinese companies are temporarily stopping production, cutting jobs and looking for new markets in response to US tariffs, CNBC reported, citing sources.
"I know of several factories where management has sent half of their employees home for several weeks and stopped most of their production," Cameron Johnson, an employee of the consulting company Tidalwave Solutions, told the television channel. Factories producing toys, sporting goods and low-cost products, such as those sold in fixed-price stores, have been hit the hardest, according to a Shanghai expert. The trend has affected China's key foreign trade centers - the cities of Yiwu (Zhejiang province) and Dongguan (Guangdong province), but "it has not yet become widespread". At the same time, there are concerns that the number of such cases will grow.
In an interview with CNBC, Li Yan, factory manager and brand director of the Chinese sportswear company Woodswool, said that all its orders in the US have been canceled. In this regard, the company, which has exported goods to the US market, as well as to Europe and Australia for more than 20 years, has decided to suspend the operation of some of its production facilities for 2-3 months until it can enter new markets.
Earlier, Yu Yadong, Vice Minister of Human Resources and Social Security of the People's Republic of China, said that the increase in tariffs by US President Donald Trump has had a negative impact on the labor market in China. He noted that "some foreign trading companies have encountered difficulties in production and operation", which has affected the employment of some workers, and this pressure continues to grow. Investment bank Goldman Sachs estimates to CNBC that between 10 million and 20 million local workers are employed by companies focused on exports to the US.