China's New Schedule: Work Hard, Play Hard

In an effort to increase consumer participation in China's economy, the government is setting out radical changes in the way the country goes on vacation.

It is an intriguing attempt at social engineering. By ordering staggered vacation days to force workers to take their trips after peak season, the government aspires not only to put more of its hard-working people on holiday longer, but also to put behind the country the dizzying images of crowds of tens of thousands of people overflowing train stations and sightseeing spots during Golden Week and the Spring Festival.

Thus to better accommodate this large and accelerating economic force, the State Council has just released itss 2013-2020 "National Tourism and Leisure Outline," which aims to alter the way China takes time off.

China has been attempting to shift to a consumer economy, an enormously difficult task in a country where most families supplement an inadequate social safety net by saving as much as 50 percent of their annual incomes for retirement, medical care in the absence of insurance, schooling for children and other indispensable needs. Modifying the holiday schedule is a relatively modest attempt to put more consumer money into the economy.

However, workers coming back after this year's Spring Festival celebration, according to the 2013 national holiday schedule set by the State Council, need to work seven consecutive days starting this past Saturday before taking a rest.

After that the cabinet's General Office has greatly modified this year's calendar to extend holidays by scheduling make-up days on Saturdays and Sundays. In 2013, China's workers will report for duty on a total of 12 weekend days, compared with just seven last year. The rationale for this grand orchestration is to boost domestic consumption by encouraging more to go on longer trips that directly lift travel spending. The state-owned Xinhua News Agency in a recent dispatch, highlighted the domestic tourism market in China as the largest of its kind in the world, with the tourist-flow count (number of travelers times number of trips) reaching nearly three billion - in a country of 1.3 billion people - in 2012 and showing no signs of letting up.

One key problem that the new policy paper attempts to address is the reality that the majority of Chinese workers, both in government posts and in private businesses, still do not get to enjoy paid vacations even though relevant government ordinances have been in effect since 2008. The rule stipulates that workers are entitled to five to 15 paid-leave days annually depending on their service tenure, and 300 percent overtime wages for working during holidays. The regulation is widely ignored.

Beijing is seeking to rectify the situation by 2020, and now is officially encouraging increased flexibility for companies and institutions to make their own arrangements for holiday schedules. The government is also encouraging local governments to set district school holidays to better suit their own regional climates. This is very positive for the tourism industry as more people would be able, and logically more willing, to go on tours outside of peak seasons.

The State Council has also pledged to boost public spending to improve leisure and travel facilities. Specifically, the government is now targeting building more parks, resorts, as well as large projects like cruise terminals. Small and medium start-ups to offer museums, exhibitions and music halls will also be supported, according to the official guidance.

Developing mass market tourism is natural to an urbanizing China with fast rising income levels. One of the country's biggest problems, however, is cleaning up distressing levels of pollution that blight some of the country's most famous tourist spots. Water pollution has almost ruined once-beautiful lakes and other sites, and domestic tourists pay no attention to signs asking them to clean up the litter. In addition, tourists are often ripped off by tourism operators, sometimes causing violent incidents.

Official 2013 National Holiday Schedule

New Year

• January 1-3 (three days in total)

• January 5 (Saturday) and January 6 (Sunday) are official working days

Spring Festival

• February 9-15 (seven days in total)

• February 16 (Saturday) and February 17 (Sunday) are official working days

Tomb Sweeping Day

• April 4-6 (three days in total)

• April 7 (Sunday) is an official working day

Labor Day

• April 29 - May 1 (three days in total)

• April 27 (Saturday) and April 28 (Sunday) are official working days

Dragon Boat Festival

• June 10-12 (three days in total)

• June 8 (Saturday) and June 9 (Sunday) are official working days

Mid-Autumn Festival

• September 19–21 (three days in total)

• September 22 (Sunday) is an official working day

National Holiday

• October 1-7 (seven days in total)

• September 29 (Sunday) and October 12 (Saturday) are official working days

(Steve Wang is chief China economist for the Hong Kong-based REORIENT Securities)