China’s youth face a dismal employment landscape amidst unprecedented unemployment rates

In a notable departure from the traditional celebration of completing university, Chinese graduates this summer took to social media to share theatrical images of themselves discarding their hard-earned degrees in trash bins. This display serves as a stark reminder of the grim reality of soaring youth unemployment rates in 2023. The situation is expected to worsen in the coming months, posing a significant challenge for the Chinese government as it strives to revive the country’s sluggish post-Covid economy. With well-paying job opportunities becoming increasingly scarce, many young individuals have expressed their intention to prolong their time in academia, while others scramble for limited government positions as the private sector experiences a drying up of prospects.

Sampson Li, a recent master’s graduate in software engineering, initially sought employment but ultimately decided to pursue a doctorate instead. Speaking to AFP, the 24-year-old shared his experience of passing three rounds of interviews at a major technology company in Shenzhen, known as China’s Silicon Valley, only to discover that the company had put a freeze on hiring. He further revealed that three other companies were willing to offer him lower salaries than the market rate, making it impossible for him to sustain himself in the city.

According to data released by the National Bureau of Statistics, the unemployment rate for people aged 16-24 in May reached a record high of 20.8 percent, surpassing the previous milestone of 20.4 percent set in April. Larry Hu, Macquarie Group’s chief China economist, cautioned that this figure could rise even further in July when an additional 11.6 million college graduates begin their job search. He highlighted the reluctance of corporations to hire due to weak consumer demand, which in turn dampens consumer spending and exacerbates the challenges in the labor market. Given this scenario, Hu emphasized that policy interventions are crucial at this stage.

At an April State Council meeting, Premier Li Qiang committed to ensuring stable employment opportunities for young people while acknowledging the need to stabilize the scale of employment in manufacturing and foreign trade enterprises. He also stressed the importance of aligning university curriculums and enhancing the quality of vocational education and skills training to meet market demand. However, the anticipated stimulus measures for the economy, including efforts to boost the job market, have fallen short of expectations. Additionally, an interest rate cut implemented on Tuesday proved to be less impactful than anticipated.

One of the contributing factors to the slowdown in China’s once-thriving private sector is a government crackdown on property companies, technology giants, and private tutoring firms. Yu Jie, a senior China research fellow at Chatham House, highlighted that while the Beijing government maintains a state-led economy, private companies account for up to 80 percent of urban jobs. These sectors heavily rely on young individuals willing to work long hours for lower salaries.

Liu Qian, equipped with a fintech degree, has spent the past six months searching for employment. She noted that there were numerous fintech start-ups while she was enrolled in university, but many have disappeared due to increased governmental regulations. As a result, her parents now encourage her to study for the civil services exam in hopes of securing a job in a state-owned company. However, the competition for government positions is extremely fierce, with state media reporting that over 7.7 million applicants vied for about 200,000 government jobs at the national and provincial levels.

The frustration resulting from intense competition for decently paid employment has given rise to online memes of graduates discarding their degrees. These memes capture the prevailing counterculture trend known as “lying flat,” in which young individuals reject the pressures of urban living and pursue simpler, less professionally driven lifestyles.

According to Yu Jie from Chatham House, there is a glaring disparity between the skills possessed by young job seekers and the demands of the labor market. While the services sector shows some promise, with millions of people returning to travel and dine out after pandemic restrictions were lifted, a lack of opportunities for vocational training leaves many young individuals ill-prepared to work in this industry. In addition, the available jobs tend to be low-paying and physically demanding.

Tan Yong, who dropped out of high school, provides an example of the difficulties faced by young individuals seeking employment. After initially finding work at an assembly line making air conditioners, he was forced to leave when production moved to Vietnam. Currently, Tan works as a rider for a food delivery company, where the work is physically demanding, and the pay is meager. He highlighted that many young people are adverse to working in factories that require standing for long hours.

 

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