Youth unemployment continues to rise in China

Amidst a surge in youth unemployment, college graduates in China are facing a challenging job market, leading many to accept low-paying positions or jobs below their skill levels. Official data reveals that urban unemployment among 16 to 24-year-olds reached a record high of 20.4% in April, which is four times higher than the overall unemployment rate. This alarming trend comes at a time when millions more college students are expected to graduate this year.

Underemployment has also become a pressing issue, with many young people settling for low-skilled or part-time jobs due to a lack of full-time opportunities that match their qualifications. Graduating during an economic downturn can have long-lasting effects, as research from Stanford University indicates that those who enter the workforce during a recession earn less for a significant period compared to their peers who graduate in prosperous times.

Data from China’s Bureau of Statistics reveals that out of the 96 million urban youths aged 16 to 24 in the labor force, 6 million are currently unemployed. Goldman Sachs estimates that there are now an additional 3 million unemployed urban youths compared to the pre-pandemic period. This growing issue necessitates urgent action from the Chinese government.

Recognising the severity of the problem, China’s State Council unveiled a 15-point plan in April aimed at improving the alignment between job opportunities and young job seekers. The plan includes measures such as supporting skills training and traineeships, expanding hiring at state-owned enterprises, and promoting entrepreneurship among college graduates and migrant workers.

While youth unemployment is a global concern, few countries are grappling with the scale of the issue seen in China. The Chinese government’s awareness of the problem and their efforts to address it demonstrate the significance they attribute to tackling youth unemployment and underemployment, thereby striving to provide better opportunities for the country’s young workforce.