Goldman Sachs China Consumer Connections: Experience Consumption Drives Labor Day Resilience
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Goldman Sachs observes that overall retail and consumer demand during the 2026 Labor Day holiday was moderate, cooling from the broad strength seen during the Spring Festival and slightly missing expectations. While the Ministry of Commerce withheld specific aggregate retail figures, official statements highlighted robust service consumption and generally stable goods sales. Tax authority data indicated consumption-related daily revenue rose 14.3% year-over-year, primarily driven by tourism, entertainment, and dining.
The consumption structure continues to diverge. Service spending decisively outperformed goods, with experience-based consumption—particularly concerts and sporting events—emerging as the most resilient category. WeChat data showed a 153% surge in event and sports transaction volumes compared to April. Cinema box office receipts remained relatively flat at 758 million yuan.
Conversely, sportswear weakened from first-quarter levels, and baijiu demand remained sluggish. Goldman Sachs noted that key provinces experienced continued inventory destocking and downgraded banquet demand. A broader baijiu recovery will likely be delayed until late 2026 or 2027.
Dining proved resilient, with major cities posting healthy year-over-year growth, supported by strong turnout at leading restaurant chains. Fresh tea beverage operators faced stronger pressure from high bases and adverse weather. Jewelry outperformed expectations, aided by gifting demand, while home appliances and telecommunications equipment benefited substantially from government trade-in subsidies and replacement demand. Goldman Sachs expects this structural divergence between strong services and cautious goods spending to persist.
Key exhibits
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