China’s youth unemployment rate is 20%, experts: the real number may be higher
The National Bureau of Statistics of the Communist Party of China released the national economic operation data for July on August 15. In July, the unemployment rate of urban youth aged 16-24 was 19.9 percent, up 0.6 percentage points from the previous month.
According to statistics from the Ministry of Education of the Communist Party of China, the number of college graduates in 2022 is expected to reach 10.76 million, an increase of 18.4% over 2021. This year, the number of graduates exceeded 10 million for the first time, and the number hit a record high.
The Voice of America reported on August 19 that Li Hong (pseudonym), an economist in Beijing, China, said the number was significant: “One is that this is higher than Europe. The unemployment rate of young Chinese in China has never been higher than in Europe. However, the past two months of this year are the first time.”
At the same time, he believes that the real unemployment rate is actually more than 20%: “20% is usually a psychological threshold, and it is usually difficult to report this number. 19.9% is stuck on the edge.”
Li Hong analyzed that this year, there are “11 million college graduates, several million vocational school graduates, and nearly 1 million high school graduates, plus middle school graduates, which add up to a conservative amount. 20 million. Last year, only 11 million new jobs were created in the city. So, in fact, the unemployment rate of young people should be much higher than this number. In this way, the unemployment rate of young people between 16 and 24 is easily Just over one-third, and three out of ten are unemployed. This is more normal.”
Li Qiang, executive director of China Labor Watch, a New York-based NGO, also believes the true figure may be higher. He said, “The rural data are not counted. China should have a comprehensive number, but we don’t know it. We only see the existing data. But this number has already made people very worried about the Chinese economy. . This number is too high.”
According to Li Qiang’s judgment, the CCP’s unprecedented release of such a high unemployment rate may be necessary for high-level power struggles. The 20th National Congress of the Communist Party of China is about to open, and the top leaders of the CCP are wrestling.
Li Qiang believes that according to the CCP’s conventional practice, such figures are generally hidden. The CCP official has never said how big a crisis has occurred. The announcement of this number actually means that the Chinese economy is facing a crisis. “The unemployment rate is so high, to some extent, it should be putting pressure on Xi Jinping.”
Li Qiang said, “China is now facing a bottleneck and the economy is slowing down. If China continues to follow Xi Jinping’s zero policy, everything is a political need, relations with Western countries continue to deteriorate, and domestic demand is used to solve the employment population. To a certain extent, , this data is to give him a warning that this road is very difficult and will also affect political stability.”
Interviews are frustrating
The Wall Street Journal reported on June 17 that in China, a large number of college graduates will face the most severe employment situation in years, the Chinese economy as a whole has lost momentum, and the CCP government’s regulatory storm has hit industries that attract young people in China, and a large number of traditional industries have been hit. Entities have closed down one after another, and the space to accommodate the employment of the labor force has shrunk sharply.
Wang Shusheng, a student at a university in the eastern Chinese city of Hangzhou, who will receive his diploma at the end of the month, said he had sent resumes to more than 250 companies in the past few weeks, some of which he was too anxious to submit at 2 a.m.
The 22-year-old philosophy graduate said that after each interview, he just felt frustrated. After trying for a few months, Wang now says he would be happy to take a job that pays 5,000 yuan a month, or less than $9,000 a year. That’s even lower than Hangzhou’s per capita disposable income of about $10,000 last year.
In February, Zheng Jin was fired by one of China’s largest real estate developers, according to Bloomberg.
Three months later, she panicked after applying for more than 400 jobs and getting nowhere.
“I can’t see the light at the end of the tunnel,” said the 26-year-old. She was interviewed for about a dozen jobs but received no offers. She worked as a market researcher in Nanjing and was one of 30% of the company’s staff laying off after the government imposed stricter financing rules on the real estate industry, plunging the industry into crisis.
“It feels like life is hopeless, and I don’t know how long I can hold on,” she said.
China’s labor market is under increasing pressure, and if unemployment in any region continues to rise, it could ripple through the economy as a whole, stoking discontent and even unrest.
“This is a big problem for a country that has historically placed a lot of emphasis on social stability,” said Stephen Roach, an economist and lecturer at Yale University.
Fewer than half of job-seeking graduates had received offers as of mid-April, compared with 63 percent a year earlier, according to a survey by Zhaopin.com. Among contract graduates, the average monthly contract salary fell 12% year over year to the equivalent of less than $12,000 a year, the survey showed.
The Wall Street Journal reported that it is difficult to make clear comparisons with official Chinese figures, which do not count hundreds of millions of migrant workers. The employment situation in China is deteriorating rapidly compared with the improvement in employment of young people in Europe and the United States.
Earlier this year, more than 200 million people were classified as flexible employment, including food delivery workers and people working on construction sites, according to China’s National Bureau of Statistics.
Song Houze, a researcher at the Paulson Institute, a Chicago-based think tank, estimates that given the sharp contraction in industrial value added and retail sales in April, China’s overall unemployment rate may actually be in the double digits.
The education and training, manufacturing and technology sectors took in the most college graduates last year, according to data from human resources services firm Worry-Free Futures. According to the latest estimates from Beijing Normal University and TAL, employment in the education and training sector alone will exceed 10 million in 2020.
Beijing resident Zhao Meng, a graphic designer, has not been able to find a job since he was fired last October by a large for-profit educational institution. At that time, the Chinese government suddenly took action to rectify the private education and training industry.
Ms Zhao, 29, said she had changed jobs before, but never thought it would be this difficult. Since losing her job, she has submitted more than 100 resumes.
To make ends meet after being laid off, graphic designer Zhao has reduced spending on food and transportation. She said she was very anxious, dazedly looking for her next job, thinking about what kinds of companies might not be affected by future policy shocks. You never know which industry will be shut down next, she said.
Li Ya, a 28-year-old film-making graduate student living in the central city of Wuhan, has gone through 17 job interviews, including with many tech companies and universities since last September, but remains empty-handed. Li said the number of companies recruiting fresh graduates to his university has decreased this year.
Finding a job is much harder than studying, Li said.
Bloomberg reports that for many young job seekers, the temptation to quit the workforce entirely and join the “lie down” movement is growing. The stress of competing for jobs with millions of people is too much for them.
David Yang, a 23-year-old student from Shanghai, said the pressure is on right now. He graduated from college with a finance degree last year, and after sending his résumé to dozens of jobs, he was frustrated and just wanted to “lie down.”