BEIJING: Factory employment has been falling for more than a year in the workshop of the world as Chinese growth slows, and analysts expect more intervention by the central bank after its second interest rate cut in just three months.
The weekend's rate reduction comes as authorities contend with rising deflationary threats in the world's second-largest economy and an unusually weak currency.
Communist Party leaders are seeking to prevent the growth deceleration from careening out of control.
Gross domestic product (GDP) expanded 7.4 percent last year, its slowest pace in 24 years, and recent indicators show signs the slowdown is continuing.
Slack manufacturing -- including employment declines in the sector according to surveys for banking giant HSBC -- consumer inflation plunging to its lowest in five years, three years of factory price deflation and a drop in the yuan currency have also sounded alarm bells.
The tightly controlled yuan extended declines after the rate cut, falling to its lowest level against the dollar since October 2012 on Monday.
Describing China's domestic economic situation as "bleak", Jeremy Stevens, Beijing-based Asia economist at South Africa's Standard Bank, says the People's Bank of China (PBoC) had no choice but to cut rates again.
"The manufacturing sector has contracted for the first two months of this year," he said in a report Monday, referring to official data. New home prices continue to fall and the country "is ebbing ever closer to deflation", he added.
"We are particularly worried that consumption growth presents a large downside risk for the Chinese economy in 2015," he said, adding there was anecdotal evidence employers were cutting wages to avoid redundancies, "presenting a big risk for spending".
A newspaper in the northeastern city of Shenyang reported last week that the monthly wages on offer at a migrant workers' employment fair were 300 to 500 yuan ($50 to $80) lower than last year.
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