Together with the 300 million migrant workers, the fate of recent graduates worries the government. In the first quarter of the year, job offers dropped 27 per cent. Those for recent graduates declined 17 per cent. This is a social bomb that threatens Xi Jinping's plans.
Beijing (AsiaNews) – Millions of Chinese graduates risk unemployment as a result of the coronavirus outbreak.
About 8.7 million college students are expected to graduate this summer. According to independent estimates, a third of them will not find employment.
Together with that of 300 million migrant workers, the fate of graduates worries the government at present.
China’s GDP shrank (-6.8 per cent) for the first time since 1976. The pandemic cut domestic demand and reduced exports to the United States and Europe, China’s main trading partners.
According to UBS Securities, 80 million jobs have been lost in services, manufacturing and construction as a result of the pandemic. For Zhongtai Securities, the unemployment rate in China is 20.5 per cent, with 70 million jobs lost due to the pandemic alone. The official unemployment rate is 5.9 per cent.
The Economist Intelligence Unit estimates that some 250 million Chinese will lose 10 to 50 per cent of their earnings.
A recent study by Peking University showed that the number of job offers shrank by 27 per cent in the first quarter. The entertainment and services sectors led the decline, followed by education, sports, information technology and finance.
According to Zhaopin, a popular Chinese job website, the first three months of this year saw the number of positions open to fresh graduates decline 17 per cent over last year, the South China Morning Post reported.
The number of people vying for the same positions increased by 70 per cent. The surge in college enrolments has outpaced the growth in white collar jobs, a decade-old phenomenon that complicates China’s efforts to mitigate the economic fallout of the coronavirus pandemic.
Until the outbreak of the crisis, the private sector led the way in hirings, but the lack of opportunities has increased competition and cut graduates’ expected salaries.
The crisis is also negatively affecting vocational training, as companies lay off students doing internships, which are often a prelude to hiring.
Unlike their peers in rural areas, Chinese university students were born and raised during boom times and thus have high expectations about their professional future.
Their frustrated dreams are a threat to social stability, the basis of the legitimacy of the Communist Party.
In view of the situation, the Education Ministry has a plan to help new graduates. This includes more hiring by state=owned enterprises and drafting more students into the military.
President Xi Jinping promised to make China prosperous and powerful by 2049. But the country is aging demographically, the result of decades of the one-child policy, and now youth unemployment poses a serious threat to his plans.