China’s job shortage problem is getting worse day by day. According to China’s National Bureau of Statistics (NBS), the unemployment rate reached an all-time high of 21.3% in July. As employment has become an increasingly challenging issue, the younger generation is being driven to short-term contract jobs such as taxi drivers and delivery personnel.
If so, what is the current status of China’s job market? There is a prevailing sentiment that the Chinese government’s estimations concerning the unemployment rate for the younger generation might be a rough approximation. This inference suggests that China’s younger generation’s unemployment rate may be higher. A July 20 report by Chinese economic media outlet Caixin revealed that Zhang Dandan, an associate professor of economics at the China Development Institute of Peking University, estimated that the youth unemployment rate reached 46.5% in March.
This stems from the fact that NBS statistics do not encompass classifications such as “full-time children” residing with their parents or “Tangping” individuals who have abandoned the pursuit of employment. Therefore, the inclusion of these groups within the unemployed category could lead to a reduction in the reported unemployment rate and bring the genuine youth unemployment rate closer to 50%.
In addition, the problem of employment fraud is also worsening. According to China’s Xinhua News Agency, on August 7, 15,000 recruitment-related complaints have been filed on the consumer complaint platform. Also, Chinese universities are increasingly demanding fake employment certificates from unemployed graduates. Realizing the seriousness of this problem, China began to investigate the reported university employment rates.
Then, what is the fundamental cause of China’s job shortage? The aftermath of the COVID-19 lockdown policies spanning the last three years has induced companies to reduce new hiring. In addition, a structural problem within the country that hinders the creation of high-paying jobs also plays a significant role.
However, China’s employment job problem is expected to continue for now. The current economic situation in China is showing signs of stagnation. The fear of long-term deflation arises due to sluggish domestic demand and a real estate slump. In other words, if this economic recession does not improve, the younger generation’s unemployment rate will inevitably fall sharply.
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