Caixin China New Economy Index Rises Again on Growing Investment

05 Oct 2023

The contribution of high value-added industries such as new energy and biotechnology to China’s total economic inputs increased in September due mainly to a rise in capital inputs, a Caixin index showed Monday.

The Caixin BBD New Economy Index (NEI) came in at 31.9 last month, indicating that new economy industries accounted for 31.9% of China’s overall economic input activities. The reading is up from 30.4 in August, and marks a third straight month of growth.

The NEI uses big data to track the size of China’s nascent industries. It measures labor, capital and technology inputs in 10 emerging industries relative to those used in all industries.

Last month’s increase in the index was chiefly attributed to a gain in the subindex for capital inputs. The subindex, which has a 35% weighting, increased 5.1 points from the previous month to 45.1 in September.

In contrast, the subindex for labor inputs, which has a weighting of 40%, remained unchanged at 22.9. The gauge tracks employee income and the number of positions in new economy industries.

The technology input reading, which accounts for 25% of the NEI, dropped 1.1 points to 27.9. The subindex measures the number of research personnel recruited by the tracked industries, the number of inventions they have created and the number of patents they have obtained.

Launched in March 2016, the NEI defines a new economy industry as one that is technology- and human capital-intensive, but asset-light, experiences sustainable and rapid growth, and is deemed strategically important by the government.

Of the 10 tracked industries, the new information technology sector remained the largest contributor in September, accounting for 8.1 points of the NEI.

The average monthly entry-level salary in the 10 industries, based on data compiled from online career and recruitment websites, was 13,878 yuan ($1,930) in September, 122 yuan higher than the previous month.

Monthly NEI reports are written by Caixin Data Technology Co. Ltd. and Chinese big-data research firm BBD, in collaboration with the National School of Development at Peking University.