This article originally ran on Nikkei Asia on June 19, 2021.
China’s May retail sales announced on Wednesday increased 12% year on year but came in below market expectations as the increase was largely due to a rebound from a steep decline driven by the COVID-19 pandemic.
Restaurant revenues and home appliance sales remained weak. An increase in youth with low motivation to spend might be behind the sluggish consumption, putting the communist party on alert.
In fact, the buzzword tangping, or “to lay flat,” has circulated on China’s internet forums in recent months, symbolizing a rejection of the pressure-packed race for a better economic life.
State media have aroused intense debates after attempts to quash this notion, widespread among China’s young people. The idea goes against President Xi Jinping’s long-term growth strategy of boosting domestic demand to overcome the uncertainties driven by ongoing tensions with the U.S. and the COVID-19 pandemic.
Is China headed for a period of Japan-style lost decades? Or, to paraphrase a classic American rock song, do many Chinese youths living in competition simply want to have their peace of mind?
Here are five things to know about the “lay-flatters” and why they matter to the Chinese economy.
What do the latest retail figures show?
Retail sales in May were weaker than the 14% growth expected by analysts and down from a 17% increase in April. May figures were also supported by the base effect after a steep decline in the previous year when the economy was hit by the pandemic. The two-year average growth is only 4.5%.
Citi Research reported Wednesday that China’s peak growth momentum may have passed, as all major economic activity indicators missed expectations in May. It cited widening income inequality, rising debt burdens and permanent behavioral changes for holding back household spending.
“In light of continued retail weakness and sluggish holiday activities, [we are] now increasingly convinced that the shadow of the pandemic over consumer behaviors may be longer than we anticipated,” the report said.
Who are the “lay-flatters”?
Tangping is yet another buzzword coined by netizens who often play with the rich meanings of Chinese characters. It literally means to lay flat, but the underlying tone connotes withdrawing from pursuit of what was considered the norm of getting a decent education, followed by a career and raising a family.
It is the ironic fallout from China’s four decades of rapid growth, pushing expectations and the cost of living through the roof. Netizens called it neijuan, which means involution arising from stagnation. An apartment in a working-class neighborhood in Shanghai can easily cost 3 million yuan ($466,000), far beyond the means of college graduates with a monthly salary of 6,000 yuan.
The tangping phenomenon reflects the growing frustration among Chinese youths who bear the brunt of pressure from family and society, on subjects from education to marriage. Confucian virtue encourages hard work and meritocracy as keys to better opportunities in life. But lay-flatters take the opposite route, preferring a laid-back life centering around their own pursuits.
Why are they in the spotlight?
How pervasive the tangping phenomenon is among Chinese youths remains unclear, but this group wields potentially strong spending power needed to propel the country’s economic growth.
The nonchalant attitude of lay-flatters alarms China’s government as it struggles with the country’s declining birthrate and uncertain economic growth. The state-affiliated Guangming Daily ran an article last month urging Beijing to pay attention and assist the lay-flatters.
“Tangping will bring about many disadvantages to the economic and social development,” it says. “The goal of high-quality development cannot be achieved without the creative contributions of our youth.”
The article by Wang Xingyu, an official at China University of Labor Relations, advocates fair and competitive market conditions to realize high-quality economic development and personal achievements.
But Li Fengling, an associate professor at the prestigious Tsinghua University’s Institute of Education, strikes an unforgiving tone in another article, “Tangping is an Irresponsible Attitude, an Insult to Parents and Millions of Hardworking Taxpayers.”
The public’s response
The Tsinghua article riled netizens. The hashtag #Tsinghua professor calls tangping mindset irresponsible# has generated over 400 million views on the microblogging website Weibo in the past three weeks.
“Roll on [with competition] while I lie flat,” a commentator said in response. The writer describes herself as a 32-year-old whose “biggest stress” is to look after her aging parents.
“I don’t want to marry and have children,” she said. “I don’t socialize and I don’t buy a house or car, only spending on the minimum. Entertainment comes from my smartphone. The most rewarding thing in life is to eat something good. Life may be boring but interesting life costs a lot of money.”
Another comment reads, “Please check who helped the professor write this piece.”
Others draw parallels with Japan’s experience. Postwar industrialization led to high economic growth before the country’s bubble economy burst in the early 1990s, followed by years of stagnation that some economists called the lost decades.
“Japan’s experience probably upsets the so-called lay-flatters about the possibility of growing old before one grows rich,” said Jiang Jian, a 28-year-old car salesman in Shanghai. “I may not agree with the tangping thinking, but I can relate to it.”
Government’s response
Xi is keen to control any narrative that defies the policy of maintaining stability. China has yet to take the drastic measure of deleting online posts related to tangping.
State media have published articles presenting the pros and cons, noting that tangping is not exclusive to China. Many developed economies have seen similar withdrawal phenomena among their populations.
Jacob Cooke, chief executive of WPIC, an e-commerce consultancy in Beijing, said he does not expect the lay-flat trend to affect consumption. Though he recognizes the competitive societal pressures on young people, he also sees silver linings.
“In general, there is not a shortage of people applying for jobs, and incomes are rising,” Cooke told Nikkei Asia.