Why focus on these two areas, a new round of intensive issuance of consumption vouchers | a new round of consumption

After a wave of consumer voucher issuance around the Spring Festival, various regions are now intensively launching a new round of consumer voucher issuance. This round of consumption vouchers focuses on consumer goods such as cars and appliances, as well as cultural and tourism consumption, with the aim of stimulating the consumption of bulk consumer goods and responding to the peak tourism season.

A new wave of consumer voucher issuance

On June 14th, Hubei announced that on June 16th, it will launch the distribution of 2023 "Hui Gou Hubei" household appliance consumption vouchers throughout the province. The total investment in this household appliance consumption voucher is 300 million yuan from the government. Among them, the online coupon investment was 50 million yuan, and the offline coupon investment was 250 million yuan.

Previously, the Hubei Provincial Department of Commerce had scheduled the "June 16th Three Good Festivals" from June 16th to 30th. During the event, in addition to distributing household appliance consumption vouchers, a 400 million yuan Hubei cultural and tourism consumption voucher will also be issued, as well as a total of 50 billion yuan of personal consumption loan interest subsidies for the whole year.

In addition to Hubei, which will distribute these 700 million yuan consumption vouchers this month, provinces and their subordinate cities such as Sichuan, Beijing, Zhejiang, Jiangsu, and Henan have also recently announced a new round of distribution plans for consumption vouchers.

The Beijing Municipal Bureau of Commerce stated that in order to accelerate the release of green consumption potential and expand service supply at important nodes such as the Dragon Boat Festival and summer, Beijing will issue a new round of "Jingcai · Green" consumption vouchers from June 3 to July 16, which are mainly applicable to 55 categories of goods, including electronic products and household appliances.

On May 18th, the Chengdu Municipal Bureau of Commerce announced that from May 20th to July 20th, the 2023 "Shuli Comfort · Car Tour Four Directions" Chengdu Automobile Consumption Incentive Event will be launched for the whole city, with a funding scale of 100 million yuan. In addition, the second batch of cultural and tourism consumption vouchers in Chengdu will also be issued with 10 million yuan on June 20th.

The Sichuan Department of Culture and Tourism recently announced that before June 30th, various regions in the province will distribute cultural and tourism consumption vouchers of about 30 million yuan, introduce more than 30 new policies such as financial support for cultural and tourism consumption, and take more than 20 new measures to enhance the vitality of business entities. They will continue to carry out more than 1000 series of activities such as "A New Experience in Sichuan - Playing with Internet Celebrity Check ins Together".

Yuhang District of Hangzhou City will distribute a total of 3 million yuan worth of "Civilized Holy Land, Let's Meet" Asian Games cultural and tourism consumption vouchers to Hangzhou citizens and tourists nationwide on June 15th. Among them, 2 million yuan will be distributed to Feizhu Travel and Gaode Map, and 1 million yuan will be distributed to live broadcast rooms such as Feizhu Shopping and Eating Group.

From these categories of consumption vouchers, one category is focused on consumer goods such as automobiles and household appliances, while the other category is focused on cultural and tourism consumption.

There are four major areas of consumption: automobiles, household appliances, home furnishings, and catering, accounting for a quarter of consumption, which are key areas for restoring and expanding consumption. After the adjustment of epidemic prevention and control policies, contact consumption such as catering has grown rapidly. In April, the national catering revenue increased by 43.8% year-on-year, an increase of 17.5 percentage points compared to March. But the recovery efforts of cars and appliances are not as strong as those of catering.

According to data from the National Bureau of Statistics, the total retail sales of consumer goods in April reached 3491 billion yuan, a year-on-year increase of 18.4%. Among them, the retail sales of consumer goods other than automobiles reached 3129 billion yuan, an increase of 16.5%. From January to April, the total retail sales of consumer goods reached 14983.3 billion yuan, a year-on-year increase of 8.5%. Among them, the retail sales of consumer goods other than automobiles reached 13571.9 billion yuan, an increase of 9.0%.

Moreover, Chen Qiankang, a professor at the School of History, Culture, and Tourism at Sichuan Normal University and president of the Sichuan Provincial Tour Guide Association, told First Financial that the issuance of cultural and tourism consumption vouchers is a marketing activity aimed at addressing the lack of confidence and sluggish consumption in the tourism market, as well as the upcoming peak tourism season. This should be timely.

Chen Qiankang said that the recovery of the cultural and tourism market is actually not ideal. One reason is that the international tourism market only has small-scale and sporadic inbound and outbound tourists, which is far from the scale before the epidemic. Secondly, due to a decrease in income or lower income expectations than before, tourists still seem hesitant to make bold purchases. Therefore, although the domestic tourism consumption market is recovering, income is not as good as before the epidemic.

Yang Chang, head of the policy group and chief analyst at Zhongtai Securities Research Institute, told First Financial that based on domestic tourism data, the overall personnel flow and travel have been fully restored. However, after calculation, the domestic tourism revenue contributed by each person in 2023 is about 540 yuan, which is still a certain gap compared to 640 yuan in 2019.

Chen Qiankang said that from the perspective of large-scale tourism, the number of people visiting scenic spots and self guided tours is increasing, which is a good thing. But for travel agencies, the recovery is not good. After June, the tourism industry will usher in a peak season, with the first wave welcoming students after the college entrance examination and middle school entrance examination, followed by the emergence of vacation, and tourists have high expectations.

Priority given to promoting consumption or stabilizing employment

While distributing consumption vouchers in various regions, ministries are also introducing policies to promote consumption.

On June 8th, the Ministry of Commerce issued a notice on organizing automobile consumption promotion activities, which will hold the "Hundred Cities Linkage" Automobile Festival and the "Thousand Counties and Ten Thousand Towns" New Energy Vehicle Consumption Season from June to December. Among them, the "Hundred Cities Linkage" Auto Festival will establish a list of key activities for "Hundred Cities Linkage", focus on promoting car consumption throughout the entire chain, and strengthen support for car purchase preferential policies.

On June 9th, the Ministry of Commerce, the National Development and Reform Commission, the Ministry of Industry and Information Technology, and the State Administration for Market Regulation issued a notice to promote the consumption of green and intelligent home appliances, making important deployments from five aspects: green and intelligent home appliance consumption, exchanging old appliances for new ones, bringing green and intelligent home appliances to rural areas, home appliance after-sales service, and waste home appliance recycling.

Along with the release of these two major policies, local governments have also followed up with the introduction of subsidies for household appliance consumption. For example, Nanjing launched subsidy activities for car and home appliance consumption on June 6th and June 8th respectively, with a total subsidy fund of 45 million yuan, and 35 million yuan and 10 million yuan for cars and home appliances, respectively. Among them, the subsidy scope for household appliances has been expanded to include dishwashers, vacuum cleaners, smart toilet covers, and so on.

From the current economic situation, insufficient demand is an important factor restricting economic recovery. Therefore, from ministries to local governments, efforts are being made to introduce policies from the demand side to stimulate consumption. From the rebound in car sales in May, it can be seen that the stimulus policy has had a significant effect. However, the growth of consumption is influenced by various factors, especially the ability to consume and income.

Yang Chang stated that the ultimate realization of consumption is composed of multiple links, including consumption willingness, consumption ability, consumption targets, and consumption scenarios. The stimulus policies represented by consumption vouchers are aimed at boosting consumer willingness, especially when the economic cycle is disrupted. By issuing consumption vouchers, consumers are attracted from their home-based state to physical consumption scenarios. However, the above approach is based on the premise that, in the short term, the consumption capacity is not damaged, and stimulating policies such as consumption vouchers are used to stimulate consumption willingness, thereby accelerating the release of the previously unreleased consumption capacity.

However, Yang Chang stated that the current problem is that there has been a change in consumption capacity. The tourism travel reflected in the optional consumer goods has fully recovered the number of trips, but the per capita tourism expenditure has decreased compared to the same period in 2019; Also reflected in essential consumer goods such as healthcare, the amount of household healthcare expenditure has decreased compared to the same period in 2019.

Therefore, Yang Chang believes that it may be difficult to guide consumption willingness in the context of changes in consumption capacity, and the key to stabilizing consumption capacity lies in stabilizing employment. Therefore, the current focus should be on stabilizing consumption capacity and prioritizing stable employment over promoting consumption.

According to statistical data, in April of this year, the national youth survey unemployment rate for 16-24 years old was 20.4%, breaking through 20% for the first time and rising to 20.4%, the highest since the fixed release of this data in January 2018. Meanwhile, data released by the Ministry of Finance shows that in the first four months of this year, personal income tax was 538.4 billion yuan, a year-on-year decrease of 2.4%.

Yang Chang stated that during the disturbance of the epidemic, it is more important to stimulate consumer willingness because in the face of short-term disturbances, employment positions can remain relatively stable; At present, the change in the number of subway commuters on weekdays may point to the instability of employment positions, which in turn explains the change in consumption capacity. This requires a further shift in policy focus towards stabilizing employment.