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Faced with slower-than-expected economic growth and increased regulation, some Chinese financial professionals have been leaving the industry for opportunities in other fields, per a new report.
Goldman Sachs this week raised its GDP growth forecast for China from 4.7 percent to 4.9 percent, signaling optimism over Beijing’s most comprehensive stimulus measures in years. However, the regulatory crackdown on China’s $67 trillion financial sector continues to worry investors.
Slumping stocks and depleted equity have been key concerns, exacerbated by President Xi Jinping’s “common prosperity” campaign, which aims to reduce income disparities. This campaign has led to salary caps and bonus reductions, hitting the financial industry hard.
Hector Retamal/AFP via Getty Images
According to Reuters, Xu Yuhe, a former hedge fund professional, recently left his position as a partner at Deep Water Fund Management after three years of stagnation in the financial sector.
Xu told Reuters he switched to a more stable career helping students study abroad, citing a growing trend of people seeking education or migration opportunities in Hong Kong or Singapore—regions that offer international experiences while maintaining cultural similarities to mainland China.
Xu said that while stocks have recently hit record highs due to the stimulus, it is unlikely to have a lasting impact on investor sentiments.
Newsweek reached out to the Chinese Foreign Ministry with a written request for a response.
Others have made even more dramatic career shifts, per Reuters. Wu Shichun, a venture capitalist and founder of Ningbo-based Plum Ventures, has found a second calling as a stand-up comedian, the report said.
“I feel grateful for such a difficult time. It’s a source of fodder for my performance,” Wu said at a performance, per the news outlet. “Nowadays, everywhere in this industry, you come across deadbeat investors and entrepreneurs on the verge of life and death.”
Meanwhile, the banking industry faces its own crackdown, including travel bans, detainments, and arrests. IPO activity has also dropped off, with many companies hesitant to go public.
Fewer than half of the more than 8,000 registered IPO sponsors have finalized a deal this year, Reuters cited the Securities Association of China as saying.
One former banker, Gu Zaifeng, left his position as an IPO sponsor to take up a secretarial post in a Shandong province village, the report said. “From an IPO sponsor to a village secretary, alumni Gu has given up high pay in Shanghai and settled down at grassroots level,” said the Nanjing University alumni association, according to the news outlet.
China’s long-awaited stimulus measures, announced late last month by the People’s Bank of China, include lowering banks’ reserve requirement ratio to free up 1 trillion yuan ($142 billion) for lending. The central bank also pledged to lower interest rates on existing mortgage loans, aiming to boost liquidity and support the country’s troubled real estate sector.