Remember when multiple staff members in accounts departments were tasked with calculating employee pay? It was a time-consuming process that involved manually handling cash, printing cheques, and ensuring every detail was meticulously accounted for.
Fast forward to today, and the landscape has dramatically transformed. Advanced software now calculates complex pay rates automatically, integrates seamlessly into full company accounts, and facilitates instant electronic transfers of wages. Employees can effortlessly access their pay through electronic banking or platforms like WeChat Pay, eliminating the need for cumbersome bank visits.
This shift has undoubtedly boosted productivity. However, the question arises: how is this increase accounted for in the national GDP? Traditional GDP metrics seem to fail in effectively measuring these enhancements.
Moreover, the modern workforce is increasingly engaged in what the Americans call a side-hustle. Whether it's selling goods on WeChat, promoting products as influencers on TikTok, or pursuing income from a second job or hobby that aligns with personal passions, these activities contribute significantly to economic activity.
Paul Donovan, the chief economist at UBS Global Wealth Management, addressed this issue during his visit to Sydney. He stated, \"We can't trust the economic data anymore. So much structural change is happening, which we're missing. We're missing a lot of the ability to measure productivity gains that are taking place; we're constantly underestimating economic activity, which means we're underestimating productivity gains.\"
Despite these dynamic changes, national GDP accounts continue to rely on traditional measures of economic activity, such as steel production, electricity consumption, and retail sales from registered businesses. This outdated approach overlooks the significant contributions of the digital economy and modern work practices, painting an incomplete picture of China's true economic strength.
Reference(s):
cgtn.com
