Mass Japanese Firms Leaving China! Hangzhou, Dongguan Struggling, Chinese Beg Them to Stay

Añadido: 2026-04-30

[00:00:07]A woman living in China is emotionally overwhelmed because she can't find a job. She's been searching for a long time. Every time it's either a scam where she gets tricked into working in the gray industry or they ask for a deposit or even worse, they offer her a salary of 3,000 yen to scam others. She cries out, "What kind of life is this?

[00:00:38]I really don't know what to do right now. I've been to so many interviews, but they either just want me to hit KPIs or they hear about my age or they hear about my marital status and then nothing happens. Now I stay alone in my rented room every day with no one to talk to. I used to be strong. I used to make vlogs.

[00:00:55]I used to make videos. But just now, my phone kept freezing while editing, and the interview results are always negative. It feels like everything I've learned has been for nothing.

[00:01:08]>> I'm about to lose it. I quit my job in August 2024. Well, I was laid off. Since then, I haven't worked at all. It's been almost a year and a half. We've all been through layoffs. We've seen the big scenes. But no matter how calm we are, there's always some fear. I don't know if it's because of the information bubble, but on the platforms I visit, so many people are unemployed. I used to think it was because I was older in my 30s that it was hard to find a job, but now people under 30 are also struggling to find work. I've noticed in Hjo the subways are really empty now. It's so easy to find a seat. I remember before it was so crowded you could barely stand firm, but now there are so few people that finding a seat is easy. Who's even riding these trains? China is being swept up in a hurricane of unemployment.

[00:01:55]Right now, it's just the calm before the storm. On the streets and in the alleyways, more and more families are falling into the same situation. It's not just one person unemployed, but the entire family.

[00:02:09]The environment this year is probably too tough. My two sisters and I are all at home without work. I'm 36 years old, graduated from the community college, but I can't find a job. My second sister is 35, graduated from vocational school, and also can't find a job. My youngest sister is 28, has a master's degree, and still can't find a job. I don't know if it's the environment, but it's just so difficult. According to the latest data from the Chinese government, the urban survey unemployment rate for the first quarter of 2026 has risen to its highest level in recent years, hitting a 13-month high. Among these, the unemployment rate for young people aged 16 to 24 reached 16.9%, an increase of 0.8 percentage points from February. Behind this number are millions of young people facing the harsh reality of being unemployed right after graduation.

[00:03:02]What's more, an estimated 12.7 million college graduates are expected to enter the workforce this summer, an increase of about 4% from last year, setting a new record. Scholars point out that the official youth unemployment rate does not fully reflect the true situation. If we include flexible employment, unstable jobs, and those with sporadic income, the actual proportion may be much higher than the surface figure, possibly even over 40%.

[00:03:30]Against the backdrop of China's ongoing economic downturn, one of the country's most vibrant cities, Hongjo, is seeing both young people and migrant workers struggling to find jobs. Recently, hundreds of job seekers have gathered at the gates of factories at the Sia Sha Industrial District, waiting in long lines for interviews. In a video from the scene, a filmer helplessly says, "Now everyone is crowding here. The factory needs a few workers, but many people have come. 300 applicants and they only picked 20. Many people don't even get the chance for an interview. A lot of young people from places like Guangdong thought there were more opportunities in Hjo, but after arriving, they found the positions were scarce and they ended up staying here, stuck, and their lives were in trouble.

[00:04:15]Hanjo's Shaza area has long been seen as a manufacturing hub in the Yansa River Delta, home to industrial parks and supporting companies, including Japan's Panasonic. But now, the demand for factory jobs has clearly shrunk. An electronics trade businessman from Hjo, Andrew Tiang, told the Epoch Times that local private companies are generally laying off employees. It's already hard for locals to find jobs, but it's even harder for workers from other provinces, especially after spring. Many factories here have stopped production because they haven't received enough orders, and many foreign funded enterprises have left. He gives an example. A Nordic company that produced feed equipment in the area reduced its workforce from 80 employees to just 29 and the trend of layoffs may continue. Andrew says the economic downturn directly affects consumption. Purchasing power is decreasing and demand for feed in the farming industry is down. So related equipment naturally won't sell. All industries are shrinking and there are very few factories still hiring and the conditions are tough. Usually they prefer young, hardworking people who can handle the job. Now they're hiring temporary workers for 13 yen per hour, but the government regulation is 25 yen.

[00:05:33]In suburban areas like Tonglu and Trinan, it's 22 yen per hour. According to the official standards, the minimum hourly wage in Hongjo is 25 yen, but some job seekers report that some positions offer much lower wages. Low pay and unstable working hours make it difficult for many young people to maintain even basic living expenses, even if they manage to find a job.

[00:05:56]What's even more concerning is that some illegal intermediaries are posting fake job listings online, charging job seekers hundreds of yen in miscellaneous fees, but failing to provide actual job opportunities. Many young women from other provinces have fallen into scams, losing money and facing a blow to their confidence. A worker from Yunan said on Doí, "I've been in Hjo for a week now.

[00:06:20]Online, people said it was easy to find a job in a foreign funded factory here, but after coming, I found that it's not true. Even a job paying 13 an hour is hard to find. If I can't find a job soon, I'll have to go back to Yunan." A young woman cried online, saying she was scammed by a black market agent. I gave the agent several hundred yen for miscellaneous fees, but they never arranged any job for me. One Edison commented on social media, "The job situation has gotten so bad. I graduated with a bachelor's degree in my early 30s, and I can't find a job in Hangha, a second tier city. This is just one of the many unemployed friends I know. Even after lowering my standards, I still can't find a job that will allow me to make a living. What's even worse is I interviewed at eight companies and half of them were scams." A businessman from Wenjoang named Lio Mao said that the problem isn't just that there are few jobs in Hongjo but that the entire mainland is facing an accelerated economic downturn. He said although Joyouang's GDP growth looks steady, the reality is that false data is covering up the harsh situation on the ground.

[00:07:26]Foreign enterprises are being restricted in China by the authorities. In the eyes of the Communist Party, foreign companies are making money by exploiting low costs and human rights violations.

[00:07:36]While private companies face tax investigations and fines, with all this exploitation, no company can survive. On April 20th, HJO Customs announced that the total value of Jang's goods trade in the first quarter of 2026 was 1.38 trillion yen, a 7.1% increase yearonear.

[00:07:56]Imports and exports both maintained growth for four consecutive quarters.

[00:08:00]Among them, exports were 1.04 trillion yen, up 6.8% 8% and for the first time in history the export scale exceeded the 1 trillion UN mark. However, Leo disclosed that Jang's export trade data is inflated. He said the data I received from friends inside the system shows that this year's export figures are lower than last year's, not a 7.1% increase. My friend told me that many places are falsifying export data. Some are double reporting taxes or reporting false taxes to get subsidies and the higher-ups pretend not to see it. This country is doomed. From 2024 to 2025, the profit margins of industrial enterprises above a designated size in Jang continue to face pressure. Hang, a textile industry insider in Jaang, admitted to reporters that in recent years, many family-owned foreign trade companies that once supported the county economy have closed down. He said, "Now profit margins have fallen below 3%.

[00:09:00]Most garment factories are either losing money or already shut down. This phenomenon is a concentrated manifestation of the hollowing out of Jian's private economy. The local economy, once supported by flexible family-owned businesses and foreign trade orders, is now losing vitality under the dual pressure of the global industrial chain reshuffle and weak domestic consumption." Hang said, "Dreang has changed. It's no longer a place where you can make money. Many businesses aren't just having low profits. They're barely holding on, running at a loss while still trying to keep going or simply shutting down.

[00:09:35]Private companies in Jang Su and Jang have always been seen as a barometer of the economy. If even these companies can't hold on and start closing down on a large scale, it means the entire economy is in serious trouble. Earlier media investigations revealed that some local governments have used shell companies to buy export data to beautify their performance. Although these actions do not have a tangible impact on the real economy, they distort the true economic landscape. China, which once relied on its large labor force and relatively complete industrial chains to earn the title of the world's factory, is now facing a shutdown. Especially after the pandemic, many multinational companies realized that overly concentrating manufacturing in China is a high-risisk choice. The ongoing US China trade war, geopolitical uncertainties, the fragility of logistics chains, and the continued changes in labor costs are pushing the industrial chain to spread to Southeast Asia, India, Mexico, and other regions.

[00:10:33]In this global migration, China's situation is particularly difficult.

[00:10:38]Over the past five years, foreign funded companies have been closing their factories in China on a large scale. The withdrawal of Japanese companies is especially noticeable. Giants like Sony, Panasonic, and Itto Yokado have successfively left. And now, Honda has also announced the closure of its two fuel vehicle factories in Guanghou and Wuhan. Honda sales in China, which peaked at 1.6 6 million units in 2020 have declined for five consecutive years, dropping to just 645,000 units in 2025.

[00:11:11]Specifically, one of GAC Honda's factories is expected to stop producing fuel vehicles around June 2026, and the related factory of Dongfang Honda in Wuhan may face a similar adjustment in 2027. Industry estimates suggest that about 7,800 employees will be affected by the shutdown. Meanwhile, global mechatronics giant Naidc, a leading precision electric motor manufacturer, is shutting down its first factory in Donguan after 30 years of operation. The factory will cease production by the end of May, leaving 2400 workers unemployed instantly. Its upstream and downstream satellite factories are estimated to lose around 10,000 jobs. Internal notices show that the factory will completely stop production on May 30th, 2026 and enter the subsequent closure phase. The notice mentioned that due to the continuous impact of external environments, the business has been facing difficulties and the company has decided to cease production after evaluation. The company will negotiate labor contract termination and offer compensation accordingly.

[00:12:17]Naidc founded in 1973 and headquartered in Kyoto, Japan, has long been a global leader in the micro motor field. After entering China in 1992, it gradually established a production and R&D network in cities like Dalian, Donguan, Sujo, and Jzang. The Donguan factory used to be an important part of China's manufacturing network. Naidex shutdown reflects the changes in the precision manufacturing sector. Micro motors which are widely used in electronics and automotive components were once an important support for China's exports.

[00:12:52]Chinese financial scholar Suling commented that Naidc was an important project for Dongwan's foreign investment attraction in the early days of China's reform and opening up. But in recent years, foreign funded companies, including Japanese firms, have been gradually withdrawing. He said foreign companies in China no longer have it as good as before. The business environment has changed drastically. The notice mentioned the continuous impact of a complex environment which is actually a helpless move. Seline believes that the tense SinoJapanese relations have accelerated the pace at which Japanese companies are leaving China. The closure of Naidex factory in Donguan highlights the changing policy environment for Japanese companies in China. Yang Haing, a professor at Shiuoka University in Japan, told reporters, "China's business environment is becoming increasingly harsh, and foreign companies are facing more restrictions. If companies try to withdraw, they may encounter issues like tax audits. This kind of environment has a direct impact on corporate decision-making. A survey released by the China Japan Chamber of Commerce this February showed that Japanese companies in China are continuing to have a pessimistic outlook on the business environment. The survey covered 1427 Japanese invested companies and only 1% of respondents believed China's economy was improving. Nearly half of the respondents judged that the economy is currently or will continue to deteriorate, a figure that has changed little from 3 years ago. The survey indicated that if the current environment continues, Japanese companies in China may further adjust their investments, personnel assignments, and business layout. Only 17% of companies plan to extend their investments in China, while more than 40% stated they would reduce or stop investments. Some companies have already begun evaluating the possibility of scaling back operations or gradually exiting the Chinese market. Mr. Tao, an investment consultant in Jang who specializes in foreign capital services, told reporters he is closely monitoring the investment environment for Japanese companies in China. Japan is one of the most influential foreign investors in China's manufacturing sector, both in terms of investment scale and the number of companies. They maintain investments of over 100 billion US in China and if these companies leave, many Chinese upstream and downstream businesses will lose orders. Mr. Tao added that the survey reflects more of a confidence issue. Foreign companies value predictability in expectations and once those expectations become uncertain, the pace of investment naturally slows down.

[00:15:27]Mr. Hong, a company head in Shenzhen, shared with reporters that Japanese companies have extensive cooperation with Chinese firms in fields like automotive, electronics, precision manufacturing, chemicals, and retail.

[00:15:40]Many of these partnerships are deep collaborations, he said. For example, Guanjo Honda auto parts manufacturing, restaurant chains, and the China Japan joint venture TDK established in the early 1990s in Dalian. These partnerships have become embedded in the industrial chain and any impact from policy changes will affect employment and income for ordinary people. Mr. Hang also mentioned that some well-known Japanese companies are indeed closing individual factories or adjusting their business layouts. He said, for example, Canon's factory in Jungan has closed.

[00:16:15]Sony has withdrawn part of its business from China and some joint ventures have ended. These are adjustments at the level of individual factories or business lines and they do not mean that companies are leaving China entirely.

[00:16:28]However, these changes reflect the fact that the economic environment now is different from before.