Why economic pressures are changing work culture in China?

You often sense the shift before you can measure it. It shows up in the way a room feels. Your China team still joins the all hands calls, still says the right things, still ships the work. Yet something underneath has changed. Cameras stay off more often. There are fewer volunteers for midnight deployments. Your star performer asks whether they can relocate to a smaller city, or accept slower progression in exchange for more stability. No one is staging a rebellion. Instead, they are quietly reorganizing their lives around a new economic reality.

For years, contemporary Chinese work culture was defined by speed and sacrifice. The 996 pattern working from nine in the morning to nine at night, six days a week became shorthand for hunger and ambition. It was harsh, but many accepted it because there was a believable story attached to the pain. Wages were rising, property prices seemed to move in only one direction, and the idea of enduring a punishing schedule in exchange for long term security felt rational. There was an unspoken contract. If you gave your twenties to the company, you would buy your way into a safer thirties and forties.

That contract has weakened. After the pandemic, China has had to cope with a prolonged property downturn, weaker private sector sentiment and a stubbornly difficult job market for young graduates. Local governments have struggled with heavy debt and tighter budgets. Companies that once rewarded loyalty with generous bonuses now cut variable pay, freeze hiring or trim headcount entirely. Even parts of the public sector that were once seen as safe harbors have started to feel the strain. When the upside looks less certain and the downside feels heavier, people do not simply double their efforts. They begin to renegotiate how much of themselves they are willing to trade for work.

Two concepts have come to capture this renegotiation in popular language. The first is involution, the feeling that everyone is trapped in an endless internal competition where more effort no longer leads to better outcomes, only to exhaustion. The second is lying flat, a deliberate decision to step back from the race, meet only basic needs and refuse to chase status markers that no longer feel within reach. Scholars describe involution as a kind of irrational over investment in a saturated system, and lying flat as a psychological exit when the effort reward balance breaks. In many teams you can see both in the same room. Some employees still grind aggressively just to protect their seat, while others around them consciously stop pushing for promotion and begin designing smaller, quieter lives.

Beneath these phrases lies a straightforward economic logic. Profit margins are thinner. The cost of debt is higher. Growth is no longer something founders can assume as a default base case. Revenue is lumpier and pricing power is weaker. That pressure flows directly into salaries, bonuses and hiring plans. Leaders try to preserve cash by tightening performance standards, adding aggressive targets, or stretching existing teams to cover more scope. Employees experience the same inflation, high housing costs and social expectations, but with reduced upside in return. When leaders keep asking for more effort while providing less tangible reward, the choice to lie flat stops looking like an online joke and starts to resemble self preservation.

At the same time, the cultural narrative that once glorified sacrifice has lost some of its power. In the early 2010s, embracing 996 still carried a certain prestige. It meant you were in the arena, part of the defining projects of the era. Today, younger workers have watched too many layoffs, too many delayed IPOs, too many stock options that never turn into life changing money. The dominant mindset has shifted from growth to survival. When people move into a survival frame, they start optimizing for stability, lower living costs and psychological safety, not only for higher compensation.

You can see this shift in the rise of alternative work arrangements. In places like Anji and other smaller cities, emerging communities of remote workers and creatives blend modest digital incomes with lower cost, slower paced lifestyles. Many of these individuals have already tried the big city grind, burned out under high rent and aggressive schedules, and now consciously accept smaller pay in exchange for more control over their days. What was once dismissed as lying flat or lack of ambition is gradually being reinterpreted by some local governments as an opportunity to attract talent, stimulate rural or small city economies and experiment with new forms of work and living.

The wider system, however, is not entirely comfortable with visible disillusionment. As public frustration about unemployment, overwork and stalled opportunities has become more vocal online, authorities have worked to curb overt pessimism. Social media platforms have been instructed to remove content that is seen as excessively negative or demoralizing, including clips that highlight the struggles of graduates taking low paid jobs or workers sleeping in cramped conditions. Official messaging emphasizes confidence, patriotism and perseverance. This does not remove economic anxiety. It merely pushes the most honest expressions of that anxiety into private conversations and encrypted chats.

For founders and leaders, the result is a work culture that looks different from the mythology that still circulates in other regions. On the surface, it can seem like not much has changed. Offices are still occupied late into the night. Competition for prestigious roles remains intense. Tech hubs continue to innovate and launch new products. Underneath that surface, however, you find employees recalculating their loyalty, younger generations looking seriously at slower life paths, and a state that wants to keep the story of hustle alive while also adapting to a stalled engine.

This creates several hard lessons for anyone building teams in or inspired by China. The first is that you cannot apply the old 996 logic in an economy where long term security is harder to promise. If your business model does not offer a credible upside for the people who sacrifice for it, pushing them harder will not recreate the feelings of an earlier boom period. It will only accelerate disengagement. In an environment where economic pressures are changing work culture in China, founders must reconsider the entire effort reward equation. That might mean offering real equity with clear vesting outcomes rather than only slogans, sharing profits more transparently, or building promotion paths that feel achievable instead of arbitrary.

A second lesson is that constant internal competition has hidden costs that emerge clearly when growth slows. Involution is what happens when leaders rely on ranking, comparison and tournament style incentives without expanding the space for genuine advancement. These tools can appear efficient in a boom, when there are new roles and markets to absorb top performers. In a slowdown, they intensify fear and make withdrawal a rational choice for anyone who believes they are not protected. Cultures built around collaboration, mutual support and stable expectations may look softer on the surface, but they are often more resilient when the broader economy becomes unpredictable.

A third lesson is that flexibility is no longer a nice to have perk. It has become an economic coping strategy for workers. When employees ask to move to smaller cities, seek hybrid or remote arrangements, or request structured breaks, they are often solving problems that your salary budget cannot. They are trying to close gaps between income, living costs and mental health. In China, the spread of alternative work communities and slower life movements is one visible expression of this logic. The leadership response that works is not to dismiss these choices as laziness, but to examine where your own operating model can accommodate more flexible paths without damaging delivery.

There is also the reality that what your team feels and what they feel safe expressing are pulling apart. Restrictions on negative speech in public spaces do not magically remove dissatisfaction. They change how it travels. It shifts into side conversations, jokes that outsiders do not catch, quiet job searches and sudden exits. When you see a team that appears compliant but emotionally flat, you should assume that many individuals are already negotiating a different relationship with work in their minds. If you do not create channels for honest conversation, you will only discover this late, in the form of attrition or quiet sabotage.

It is tempting for founders in Kuala Lumpur, Riyadh or Singapore to treat all this as a uniquely Chinese story, shaped by that country’s specific institutions and politics. That would be a mistake. China is further along a curve that many high pressure economies may eventually face, where the promise of rapid upward mobility collides with structural limits and demographic headwinds. Rising living costs, uncertain exits and a culture of constant hustle are not unique. When these elements combine without a believable path to security, workers everywhere begin to re write their personal contract with work.

You do not need to replicate China’s old work culture or its new forms of quiet resistance. You can treat what is happening there as an early warning. Economic pressure does not only change profit margins and runway calculations. It changes what people will give you, how they will show up, and how much of their identity they are willing to attach to your company. They will often adjust their behavior long before they tell you explicitly that they have checked out. Your leverage as a leader lies in recognizing these faint signals early, designing a deal with your team that fits the current reality, and building a culture that does not depend on denial.

If you ignore those signals, you may wake up one day to find your own version of a lying flat team. They will still respond to emails. They will still attend meetings. On the surface, nothing will look obviously broken. Yet the sense of shared future, the willingness to stretch, the instinct to build beyond the minimum will have quietly drained away. In that kind of environment, economic pressure is no longer just an external condition you are managing. It has seeped into the culture itself, reshaping the way people work, the way they think about your company, and the way they map their futures far beyond your office walls.