Shanghai's Minimum Wage Is 2740 but Social Insurance Contributions Hit 2731! Food Delivery Passed Down Through Layers of Subcontracting, Courts Rule the Platform Is the Employer in Under 1% of Cases, Social Insurance Subsidies Equal Half the Central Deficit, 12.57 Million More Collecting Pensions While 9.48 Million Fewer Are Paying In! Social Insurance May Run Short by Mid-Next Year at the Earliest — Retirement Can Only Depend on Yourself

The video provides a detailed analysis of China's current severe social security crisis and the plight of flexible workers through a breakdown of accounts. New regulations from the Ministry of Human Resources and Social Security aim to crack down on multi-layered subcontracting in food delivery and ride-hailing services, as well as the practice of inducing workers to register as individual business owners, in an attempt to plug social security loopholes. However, due to the severe mismatch between the social security contribution base and actual income, combined with heavy burdens on both enterprises and individuals, the trend of people stopping payments and withdrawing from the system continues to expand. Coupled with a surge in the number of pension recipients and a decrease in the number of contributors, fiscal subsidies are stretched thin, and the social security fund could face a shortfall as early as the middle of next year. The author suggests that individuals must rely on themselves for asset allocation.

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Observe things as they are, reject fragmented and dull cognition. Just on October 8th, what did the CCP push out? It's called the "Measures for Protecting the Rights and Interests of Workers in New Employment Forms." And then, the Ministry of Human Resources and Social Security released a menacing statement, saying they want to find people who haven't paid social security—are they fucking catching thieves? This is a new policy communication draft. What is the biggest change I see? It's that it contains prohibitive regulations: first, prohibiting platforms from inducing workers to register as individual business owners; second, prohibiting multi-layered subcontracting to evade employment responsibilities. Once these two prohibitions came out, my judgment is that the CCP is truly fucking desperate, because this is equivalent to the CCP itself admitting several things: that China's so-called flexible employment, like delivery riders and ride-hailing drivers, are all subcontracted out through layer upon layer of contracts. This leads to the discussion of how the more than 700 million people working in China are divided into those with an employer and those without, and what these hundreds of millions of people without an employer will live on when they get old.

What will they rely on to live? Today, I will take everyone through these accounts from beginning to end. To calculate these accounts, we must first find a number. This number should tell us exactly how many people in China have an employer. Can we look at pension insurance? No. Why? Because people in flexible employment can pay for pension insurance and medical insurance themselves, so the number of participants in pension insurance includes tens of millions of people who pay for themselves. Then what should we look at? Look at unemployment insurance, because unemployment insurance is paid by both the employer and the employee, and in national law, there is no such thing as an individual insuring themselves. In other words, if a person's name appears on the unemployment insurance list, it basically means that this person must have a fixed employer. So what is this number? Let's look at the statistical bulletin of the National Bureau of Statistics of the CCP from last year. By the end of last year, the total number of employed people in the country was 725.04 million, while only 249.18 million participated in unemployment insurance. So, 249 million.

Divided by 725 million, that's 34.4%. In other words, among the people working in China, only a little over one-third have an employer. So where are the rest? Let's subtract layer by layer. The number of people who participated in work-related injury insurance at the end of last year was 305 million. Subtracting the 249 million with unemployment insurance, we get an extra 55.82 million. These 55.82 million people only have work-related injury insurance. Let's look again: there are a total of 475 million urban employed people. Subtracting the 305 million with work-related injury insurance, there are 170 million left. These 170 million people working in cities don't even have work-related injury insurance. Further down, there are 250 million people in rural employment. In other words, not having a fixed employer is the norm for working in China. This group accounts for 65.6% of the total employed population, and they do not have unemployment insurance. Therefore, the real employment situation should be even worse than we all think, because there are only 249 million people with unemployment insurance, and compared to...

The 250 million people employed in rural areas—these two figures are almost identical. And working in rural areas basically means farming. Here is where the interesting part comes in: the CCP has actually turned the number of social security contributors into a hard metric for its performance evaluation system. It can be said that the target reveals more than the current status. This five-year plan actually addressed one thing a long time ago. How was it phrased? The CCP made a plan in the five-year plan requiring the number of social security contributors to be increased from the current 249 million to 255 million. In other words, the CCP intends to add 6 million contributors within five years. But the reality is very fitting for the CCP's style: in the first quarter alone, people were dropping out at a rate of 100,000 per day. Young people are not so easily fooled anymore. I calculated last year that a large number of regions in China would face major problems with their social security this year. Now the CCP is so anxious they are fucking scratching the walls; the number of people withdrawing from the system in a single quarter is almost catching up to the total increase planned for a five-year period. That is pretty intense, right?

There is a detail here that relates to the 323 million figure mentioned earlier, which is the payment of work-related injury insurance. At the end of last year, it was 305 million people, and by the end of March this year, it suddenly jumped to 319 million. That is an increase of 14 million in one quarter. Where did these people come from? Oh, there is a parenthesis after this number in the statistical table that says "including occupational injury protection." Ah, that makes it clear: they forcibly included freelancers like food delivery riders and ride-hailing drivers. I estimate that the number of people brought in is at least between 21 million and 22 million, but because there were also people withdrawing, the net increase was only 14 million. Therefore, the 20-plus million increase in work-related injury insurance is not because there are 20 million more employees with employers, but because there are 20 million more riders and drivers who only have injury insurance, and in all likelihood, it was forced upon them. Now let's look at how these 400-plus million people are kept out. The logic is actually simple: the obligation to pay social security follows the status of being an employee.

As long as you make that status disappear on the contract, the obligation disappears too. Let's talk about food delivery first. The Supreme People's Court of the CCP issued a guiding case the year before last in December, known as Case No. 238. I guess not many people read this case, but the CCP's entire strategy is contained within it. This case effectively exposed the relationship of full-time riders managed by delivery stations. What is the trick? It is that these delivery platforms first subcontract the delivery of a district to a delivery provider, and the delivery provider then signs an agreement that allows for further subcontracting, passing the work to a management company. When a rider registers on the app at a station, they are required to register as an individual business owner. The management company helps the rider get the individual business license and then signs a project subcontracting agreement with this "individual business." But what is the actual working relationship? Everyone knows: you cannot refuse orders assigned by the platform, and you are subject to the station manager's scheduling and the company's attendance checks—none of that is missing. It is just that the base salary is still zero. This whole cycle goes:

Platform, delivery provider, management company—not a single one is the rider's employer, which means not a single one has to pay social security for the rider. How effective is this trick? After adding this layer of transfer, meaning after the delivery provider used multi-layer outsourcing, the proportion of cases recognized by CCP courts as having an employment relationship dropped from 81.62% to 46.89%, while the delivery platforms themselves were recognized in less than 1% of cases. There are over 1.9 million suspected individual business registrations for riders nationwide, so they want to ban riders from registering as individual businesses.

But the problem now is not anything else; who is imposing this cost? It is the fucking CCP! And the process we see in the diagram where every link tries to avoid paying social security is just a matter of how to shift this cost elsewhere, right? Why shift it? You just look at one thing and you will know: the gap between the minimum wage in a region and the contribution base for that region is fucking outrageous. In cities like Shenzhen, Beijing, and Shanghai—well, not just these cities, but basically the social security base nationwide is fucking set like an alarm clock; when the time comes, it increases by a base of 8% or 15%, but people's wages haven't increased! If you earn 3,000 but have to pay based on a 7,000 base, who is the fucking idiot? If you pay this, how are you supposed to survive? Honestly, in my view, anyone who doesn't register as an individual business is the one who is sick. And what is the CCP's attitude? They are truly desperate. Let's look at how the CCP stated its position before and compare it to this current situation, back in July 2021.

The Ministry of Human Resources and Social Security and eight other departments once issued a guiding opinion. At that time, the Ministry of Human Resources and Social Security separately categorized this status as situations that do not fully conform to the establishment of labor relations. Back then, the wording in enterprise documents was still that enterprises should guide and support workers to voluntarily enroll in social insurance. Ah, it was about guidance and support back then, not forced payment. What is it now? The current task is to hunt them down, ah, to hunt down those who do not pay social insurance. Let us return to the CCP document from October 8 mentioned at the beginning. What did this draft prohibit? It prohibited inducing the registration of individual businesses and multi-layered subcontracting. In other words, the current CCP is already following this structural rhetoric, ah, and is already squeezing upwards. However, my words here are fucking useless. Why? Because income and the contribution base are completely inverted. No normal enterprise can bear this additional apportioned social insurance tax cost. This is not a matter of whether employers have a conscience; the apportionment easily exceeds 10% of the salary, meaning an income of 3000 yuan requires paying based on a 7000 yuan base.

Social insurance, I ask you, who can possibly withstand this? Moreover, these stations are all labor-intensive. If the stations were really responsible for paying in full, they could close their doors and go home on the spot. If the platforms bear it? Ah, it wouldn't even take long—8 months, and the cash flow of all these platforms would be completely cut off. Even in this state, they still want to target couriers and ride-hailing drivers? The CCP has fucking gone broke-crazy, really. So what are the problems facing these over 400 million people? The first to emerge is the inversion between actual income and the social insurance contribution base. Let us look at how severe the inversion is! The social insurance base set by the CCP is meant to rob the people with the lowest income. I call this robbing the poor to feed the rich. How did this social insurance base come about? Ah, it is calculated by lumping government organs, public institutions, state-owned enterprises, foreign-funded enterprises, and private enterprises together to calculate an average salary. Last year, the average salary in government organs, public institutions, and state-owned enterprises under the CCP reached 10787 yuan per month, while private enterprises had only 5966 yuan, and the lower limit was completely dragged up by the treatment on the CCP side. Let us look at this year's lower limits: the base in Beijing is 7270 yuan, in Jiangsu it is 5025 yuan, and in Liaoning it is 4533 yuan. How much do they actually earn? I do not know about other places, but I know Liaoning. How are the data in Liaoning written? Last year, employees in accommodation and catering earned an average monthly income of 4208 yuan, while the average income in the service industry was only 4130 yuan per month. Combined, these two industries have 58.72 million people. This is even according to the CCP's own data, and as far as I know—because my relatives run restaurants in Liaoning—people in places like Liaoning can only take home around 3000 yuan now, which is more than 1200 yuan less than the data the CCP brags about. But you have to pay social insurance based on 4500 yuan, and that is assuming there is work available; more often, people cannot even find a way to earn these 3000 yuan. Who the fuck is out of their mind to pay into this bullshit? The most ruthless place is undoubtedly Shanghai. Shanghai's lowest statutory wage is only 2740 yuan, but the lower limit of the social insurance base is 7546 yuan. If paid at the lower limit of this base, the unit must pay at least 1939 yuan per month, and the individual must pay 792 yuan. Adding 1939 and 792 gives 2731 yuan—social insurance is as much as the salary. Let us think about this with normal human thinking: in this situation, whether you are an employee or a company, would you pay for this fucking thing? Seriously, wouldn't it be better to save this money to buy fixed-term US Treasury bonds? The annualized yield is already 5%. It is uncertain whether the CCP's fucking garbage social insurance can survive until the day it pays you out. Ah, actually, my words are not rigorous; it is definitely impossible to survive until our generation collects money on that day. The CCP itself won't even survive! Can people with unemployment insurance collect money when they become unemployed? Not really. At this current juncture, the number of people collecting unemployment insurance benefits is only about 5.5 million. How many urban unemployed people are there? Let us first reverse-calculate using the CCP's own unemployment rate: total urban employment is 457 million. The surveyed urban unemployment rate is 5.3%, so the calculated unemployed population is about 26 million. Dividing 5.57 million by 26 million gives about 2%, meaning that even by the CCP's own accounts, only 20% of the unemployed can collect unemployment benefits. If calculated based on an 11% unemployment rate, it drops to less than 10%. Needless to say, the hundreds of millions of people without work units have it even worse. This year, the average monthly income of migrant workers is 5075 yuan. This is also the CCP's own data, claiming it rose by 2.3% in a year. I have no idea where it rose to, so I remain highly skeptical. Let us just look at one piece of data. There was a survey of over 5400 ride-hailing drivers in 13 cities, among which 62.8% of drivers were the only working person in their entire family. Meituan conducted a questionnaire by itself in March last year, sending out a total of 38000 copies, and the survey found that 42.46% of couriers did not have any social insurance at all. So how are family strategies coping? It is by saving more money and borrowing less money. Therefore, as everyone has seen, household deposits increased by 6.99 trillion in the first eight months, while household loans actually decreased by 1.03 trillion. That is simply how it came about.

To put it plainly, if these hundreds of millions of people lose their jobs, they have absolutely no unemployment benefit buffer; they only have their own savings and their families. What will the CCP's actions lead to directly? It means companies will hire fewer people and platforms will lower their rates, because the costs of these two things are not covered by unemployment insurance and will be dumped entirely onto individuals and families. These four hundred million-plus people have no employer to look after them, which isn't obvious during normal times. But as soon as the economy takes a downturn, it all becomes apparent. Why? Because it is inextricably linked to China's private economy. Now let's look at the cash flow situation of the private economy, which accounts for over 80% of urban employment. This is data from the CCP's own National Bureau of Statistics. By the end of August this year, the average collection period for accounts receivable in Chinese private enterprises was 76.1 days, meaning it takes a private enterprise an average of 76.1 days to get paid for their goods. How long was it at the end of August last year? It was 70.9 days, and the year before that, it was 68.4 days. Do you see the trend? The cash flow collection period has been extended off a cliff; the speed of payment delays this year has more than doubled compared to last year. Meanwhile, state-controlled enterprises in the same table only took 56.2 days, which is no different from last year. These extra 5.2 days have fallen entirely on the shoulders of private enterprises, and goods are also being stockpiled for longer.

Goods produced by private factories took an average of 25.1 days to sell from the warehouse last year; this year, it takes 26.8 days. The overall trend is that money cannot be collected and goods are piling up, which will directly lead to a visible deterioration in operating cash flow. Throughout the entire business operation, whether it's collections, inventory, or debt, not a single item is improving. Under this set of data, what do we see? It's that from January to August this year, private investment fell by 10.1% year-on-year, and short-term liquidity loans are also being repaid on a large scale, which means I am neither expanding production nor hiring people. The manufacturing and non-manufacturing indices have been below 50 for thirteen consecutive months, so is this a disease that can be cured by setting up individual merchant businesses? It's a very simple logic: if you can't collect money, you can't hire people. Furthermore, how many times has the CCP mentioned social security back and forth this year? And has anyone noticed a pattern? Every time it gets to the end of the year, the CCP gets fucking nervous, as if they've been set an alarm clock. There has been no shortage of actions taken regarding social security this year. On September 8th of last month, the CCP's Healthcare Security Administration joined seven other departments to launch a so-called three-year action plan—another campaign-style target—aimed at flexible workers, migrant workers, and some new forms of employment.

So you might be wondering, why is the CCP in such a hurry? Well, we can see why if we take a look at the accounts in the pool. Actually, I have basically calculated the CCP's social security accounts, but that doesn't matter, just ask the heart. The CCP's claim is that the fund's operation is generally stable, and by the end of June this year, the combined balance of the pension, unemployment, and work-related injury funds was 11.07 trillion yuan. But this stability is only achieved after counting fiscal subsidies as income. If we remove these subsidies and look at how the Ministry of Finance's budget report for this year is written: first, it says that the total insurance premiums collected by all social funds last year were 9.12 trillion yuan, and the money spent was 11.14 trillion yuan. 11.14 minus 9.12 leaves a gap of 2.02 trillion yuan. This hole is being filled by the treasury; last year, they subsidized a total of 2.91 trillion yuan, and this year, the budget for this hole has expanded to 2.42 trillion yuan. So how much does the treasury plan to subsidize this year? 3.11 trillion yuan. And the total fiscal deficit at the central level this year is only 5.89 trillion yuan. So let's take a look: 3.1 divided by 5.89 is 53%. In other words, the social security subsidy alone accounts for more than half of the central government's deficit. This situation is basically a Ponzi scheme on the road from being about to burst to actually bursting. That's why China is now very anxious to pull people in, but can they?

Let's look at individuals first. Flexible workers pay for employee pension insurance by paying the full 20% of the base themselves. In Hebei, the lowest bracket is 801 yuan per month; in Jiangsu, it's 990 yuan; and in Beijing, the lowest bracket this year has already hit 1,454 yuan. Even according to the CCP's own figures, the average monthly income for migrant workers nationwide is only 5,075 yuan, and the pension portion alone takes away 16% to 29%. Zhejiang University surveyed 12,000 delivery riders last year, and the riders said the maximum they could accept was 500 yuan a month. The result? Among flexible workers, even those paying only for employee pension insurance account for only about one-quarter. Let's look at companies again. An agency called 51shebao conducted a survey last year of 6,689 companies, and only 34.1% were fully compliant with the contribution base, while 44.6% of companies were using dispatch and outsourcing. The journal *World Economy* had a paper back in 2024 specifically on China's social security. They used the tightening of social security collection in 2018 as a control group, and the conclusion was very clear: the stricter the CCP's social security collection, the more companies use flexible employment.

The more the CCP tries to collect, the more companies will outsource their labor. Even if they do manage to pull people in, can this hole ever be filled? For example, the CCP claims to have tricked another 10 million people into joining the pension scheme. After all, the CCP's own five-year plan only projected an increase of 6 million. So, this 10 million figure is already extremely, extremely optimistic. If we calculate based on the lowest payment tier, that's about 10,000 yuan per person per year. 10 million times 10,000 is about 100 billion. 100 billion against a 2.5 trillion gap—this hole is only being filled by about 5% to 6%. To fill this hole, the CCP would need to pull in 170 to 210 million people, and they would have to keep paying continuously. Even if they pulled in all 170 million people in the cities who aren't currently paying insurance, it might not be enough. I want to ask the CCP one thing: when you were forcing pregnant women to have abortions twenty or thirty years ago, what on earth were you thinking? The group that most deserves to have no descendants in this world is this bunch of CCP scum. Now that they're desperate, they know how to press-gang people. After committing such evil, they want to shift the burden, but people are just saying, "I'm not paying, what can you do about it?"

And given the current state of the CCP's finances, how many years can you cover this? Let's look at the data: from January to August this year, social security and employment expenditures rose by 6.5%, which is more than five times the 6.2% growth rate of total fiscal expenditure, while revenue from land sales in the same period fell by 30%. So, this is an unsolvable knot. If the CCP collects from individuals, they can't afford it, so three-quarters of them choose not to pay. If you collect from companies, they can't afford it either, so they end up switching to outsourcing. You can't collect from either side, and in the end, the hole can only be filled by the treasury.

What will happen in the future? Actually, there's no need to guess, because the first generation of migrant workers has already reached this age. Qiu Guoxian from Anhui Normal University conducted a survey of 2,500 people, and 60.7% of migrant workers plan to keep working until they physically can't anymore; 55.2% have less than 50,000 yuan in savings, and less than 10% have participated in employee pension insurance or bought commercial insurance. Workers around 60 years old on construction sites can earn about 300 yuan a day, but if they are laid off and go to work as cleaners, they can only earn 60 to 80 yuan a day. The safety net for these people is the urban and rural resident pension insurance, which paid only 281 yuan per month last year. Furthermore, what did the 2020 census data show? 40.87% of the rural population over 60 relies on family support, 33.58% rely on working themselves, and only 10.43% rely on pensions, whereas 69.83% of urban elderly rely on pensions. How many such people are there? Last year, the total number of migrant workers in the country was 301.15 million, with an average age of 43.3 years old, and 32% are over 50. That's 301.15 million times 32%, which is 96.37 million.

By 2035, this nearly 100 million people will all be over 60. And migrant workers are just one segment; if we include everyone in the country who should be receiving a pension—employee pensions and resident pensions combined—the net increase in recipients in 2021 was 5.4 million, in 2023 it was 13.56 million, and last year it was 12.57 million. Moreover, this group is part of a baby boom, meaning that the number of people born after 1963 is increasing, and starting in 2023, this cohort has been reaching the age of 60. So, the next ten years will undoubtedly be a peak for those receiving benefits. As for those who should be paying, the net increase in employee and resident pension contributors in 2021 was 24.67 million, but by last year, employee pension insurance only added 7.44 million, while resident pension insurance dropped by 16.92 million. This includes those who reached the age to start receiving benefits, those who switched to employee insurance, and those who simply stopped paying. So, 7.44 million minus 16.92 million is a net decrease of 9.48 million people. While the number of people receiving money increased by 12.57 million, the number of people paying money decreased by 9.48 million.

By this year, the budget structure has become like this: insurance premium revenue is only rising by 3%, while expenditures are set to rise by 6%. Insurance premiums plus fiscal subsidies minus the money to be paid out that year left 0.89 trillion last year, and in this year's budget, only 0.69 trillion remains. And this is a budget based on the assumption that insurance premiums can rise by 3%. My assessment? The number of people stopping payments will definitely continue to increase. And there is a very interesting group here—Zhongtai Securities has a calculation that is quite funny. This group consists of people who have already joined the employee pension insurance, but they are not paying. The data is as follows: in 2011, this group had 29.56 million people, and in 2022, it was 63.25 million. So, in this situation, what can companies do? They will definitely continue to outsource, right? Such a huge group is essentially freeloading. Isn't the cost the CCP wants to shift outward just this large portion of costs? So, what is the CCP's current idea? It's to excessively extract from the wallets of companies and individuals. Under these circumstances, people aren't stupid.

If you drain my cash flow, I am dead; if you drain an individual's cash flow, they cannot survive. Under such circumstances, social security revenue will not increase as expected; instead, it will drop. By how much would it drop before there is not enough to pay out? We can do the math. At this year's growth rate, expenditures in 2027 will reach 12.53 trillion, and fiscal subsidies will be 3.33 trillion. Subtracting 3.33 trillion from 12.53 trillion means insurance premiums must reach 9.2 trillion to be sufficient for payouts. This year's budget is 9.39 trillion. 9.39 minus 9.2 leaves a gap of only 190 billion, which is at the 2 percent level. In other words, as long as the contribution level drops by 2 percent, subsidies plus revenue will already exceed the balance sheet. Therefore, my projection is that by as early as the middle of next year, insurance premiums plus fiscal subsidies will no longer be enough to cover that year's payouts. Where will the shortfall come from? The first to be used will be the interest and investment returns of the social security fund, which amounts to less than 600 billion a year. In other words, as long as social security revenue drops by another 6 percentage points, even this part will not be enough to cover the gap. Going further down, either the Chinese Communist Party (CCP)'s finance continues to increase subsidies, or they will have no choice but to tap into historical reserves.

Once the reserves are depleted, I can say that the CCP basically either waits to die, pulls off desperate and chaotic moves, or pulls off desperate and chaotic moves while waiting to die. Anyway, I will repeat what I said before: for those who believe the CCP can provide for your retirement, you don't even need to ask others—just look at the overwhelming family planning propaganda from 30 years ago. We shouldn't fall for the same trick generation after generation, right? What is the CCP doing now? It is shifting the cost of the demographic cliff caused by family planning onto the current Chinese public. I am telling you, whoever helps bear this cost is fucking immoral. How did the CCP brag back then? Isn't it the same now? I still say that if you really want to fund your retirement, you must rely on yourself. Set aside a fixed percentage, find channels to buy US Treasuries, and after 30 years of compound interest, I dare not guarantee much, but two things: First, I guarantee it will definitely be more than what the CCP gives you; second, it will definitely be more stable, after all, all the necessary elements for the next major economic cycle are in the United States.