At a job fair for future graduates in central Shanghai, recruiters sat bored under washed tarps as rain and an apparent lack of interest kept potential new hires away.
The vacancies belied China’s stubbornly high youth unemployment rate — a problem so pressing that President Xi Jinping this week told top Communist Party (CCP) officials it should be a “top priority.”
His words have been seen by many analysts as a signal that reforms could be in the works ahead of the Tuesday plenary session in July, a meeting that has historically revealed major changes in the direction of economic policy.
Youth unemployment stood at 14.7 percent in April, official figures showed — and in June, another 11.8 million students will graduate from university, adding to the problem.
That number had jumped to an unprecedented 21.3 percent in mid-2023, before officials stopped releasing monthly figures. They started releasing them again in December after adjusting the calculation method.
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Hospitality and HR companies dominated Friday’s small job fair, one of several hosted by local authorities in recent weeks in anticipation of the impending influx of university graduates.
“It’s hard to find a job that matches your degree and your ambitions,” one of the few young job seekers at the fair, a data science student, told AFP.
“A lot of students have really high expectations,” said Julia Sao, who recruited for a restaurant chain.
“They don’t prefer that kind of basic position. They prefer… a fancy job.”
“Policy change underway”
Xi specifically mentioned the graduates in his speech at the CCP Politburo on Monday, noting that “more jobs should be created to apply what they have learned and what they are capable of.”
His comments follow “a steady drumbeat of comments from China’s leadership underscoring the urgency” of the issue, Erica Tay, director of macroeconomic research at Maybank, told AFP.
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The matter has been pending with the government for some time.
Along with persistently low consumption and a long-running housing crisis, the unemployment situation has been cited as a key culprit in China’s uneven post-pandemic recovery.
“While the details of Xi’s comments are unclear, it is clear that a policy shift is underway,” said Harry Murphy Cruz of Moody’s Analytics.
“We expect that policies aimed at reducing youth unemployment will be a mainstay of discussions (at the Third Plenary).”
In remarks released Monday, Xi said young people should be encouraged “to find jobs or start businesses in key sectors (and) industries.”
“Market-oriented channels and social media must be expanded for young people to find work,” he was quoted as saying.
Murphy Cruz said he expects the government to increase wage subsidies to persuade companies to hire recent graduates, as well as create more jobs for students.
However, these were only “band-aid solutions”, he said.
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In the longer term, “bigger reforms in industry and education policy” were needed to ensure a better match between the skills of graduates and the demands of employers, he said.
“Lower Expectations”
There is now a push to fill roles that “dovetail with key policy priorities” or where there are skills shortages, Tay said, such as industrial upgrading and scientific innovation.
As job opportunities dry up for those with degrees in sociology, journalism and law, he said, some sort of “earn-as-you-learn training programs” may be needed to fill more demanding roles.
Near the law school of a top Shanghai university, seniors said the job market was indeed tough.
“After the pandemic, it’s a little more difficult than before,” said 22-year-old Qian Le, referring to recent layoffs and salary cuts at top Chinese law firms.
“Even those who are already in jobs may not be able to keep them, so it may be harder for new people to get in.”
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Qian and her classmate Wang Hui had both chosen to pursue further studies.
“The economic situation is quite sluggish, many companies have gone bankrupt and many jobs have been cut,” Wang told AFP.
China’s once free private sector has slowed significantly, in part because of previous government crackdowns on companies, including tech giants and private tutoring firms.
Many young people choose to study for civil service exams — considered a more stable option — or like Wang and Qian, getting graduate degrees.
In March, universities urged their students to actively look for jobs, Tay said.
But “competition is huge, and the number of undergraduates is gradually increasing every year,” Wang said.
Karl Hu, another law student, said the difficulty was not finding a job.
The problem was finding “a suitable career” in terms of salary and benefits level, he explained.
He himself had secured a good job at a bank, he said — but many should “lower their expectations.”
Source: AFP