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Compounded by the Covid-19 pandemic and global uncertainties, the number of China’s college graduates has reached a record high, posing severe challenges to an already strained job market

By Chen Weishan Updated Jul.1

A job fair at Hainan Normal University attracted a large number of 2022 graduates, October 31, 2021

University student Wang Meng is interning at a startup in Beijing. As graduation approaches, she is struggling to find a job because of the pandemic. She expects to land a permanent position at her company, where for the past few months she has made 100 yuan (US$15) a day. Her options are limited: China’s ongoing zero-Covid policy restrictions prevent her from interviewing face to face with companies elsewhere.  

The effects have been mirrored nationwide. During a teleconference with provincial leaders in early May, Chinese Premier Li Keqiang cautioned of a “grim” outlook for China’s job market and encouraged local authorities to focus on job stability.  

Around 16 million new workers are entering the job market this year, official data says. Among them, 10.76 million are college graduates, an increase of 1.67 million year-on-year. In 1999, the first year China’s universities expanded enrollment, there were around 1 million college students.  

In late April, recruitment platform Zhaopin released a report that said more than 3 percent of new college graduates are either working as freelancers or delaying their job hunt. New hires are down by 16 percent compared to last year, while salaries fell around 12 percent. 
During a symposium on employment in China on April 7, Chinese Vice Premier Hu Chunhua said the pandemic had severely affected employment, along with other factors. He highlighted the country would prioritize employment stability aiming for an urban unemployment rate below 5.5 percent in 2022. 

Harsh Reality 
Feng Lijuan, a human resources expert at recruitment platform 51 job, was once optimistic about this year’s job market. “In fact, from the number of positions available last autumn, demand at some companies even doubled the previous year,” Feng said, adding that demand for graduate students in the semiconductor and integrated circuit fields was very high.  

“There is a sizable gap for professionals in the Chinese mainland semiconductor industry. Software engineers are particularly in high demand compared with hardware engineers,” a head of a chip design company in Shanghai told NewsChina on condition of anonymity. However, a survey conducted by 51job.com among 187 semiconductor companies showed over half hit 60 percent of their recruitment quotas last autumn. “We’d usually see a surge of graduates looking for jobs in the spring,” Feng said. “However, the pandemic and the subsequent prevention and control measures have significantly affected the ongoing spring recruitment, and the whole rhythm has been disrupted.”  

This is especially true in Shanghai. “Now everyone is locked down at home, and so far, there is no clue when the annual job fair originally scheduled for March by the municipal government will go ahead,” said an HR representative at a Shanghai-based enterprise. The company launched its own online recruitment campaign, but is not optimistic given the ongoing pandemic controls. “The situation is grim,” Feng said. “Even if enterprises have recruitment demands, it’s difficult for graduates to interview and intern offline due to pandemic prevention and control measures.”  

Neither is Beijing’s job market faring well. Around 27 universities in the capital moved classes online for the spring semester. “Some universities can’t teach offline, and science students may not graduate because they cannot conduct experiments. Even though some universities allowed students to return to campus, the tightened controls might highly affect their internships. Even if the universities help students seek internships off-campus, many employers are cautious and unwilling to offer them,” Liu Lin, rector of Beijing City University, told NewsChina. 
The proportion of college grads who remain unemployed after commencement has increased since the outbreak of the Covid-19 pandemic. “The ongoing pandemic, interwoven with the macro-economic downturn, has had a tremendous impact on the employment of college graduates,” said Zeng Xiangquan, director of the Employment Research Institute at the Renmin University of China in Beijing.  

Zeng pointed out that recruitment is affected as soon as there is an outbreak. Earlier this year, cities in economically developed regions such as the Pearl River Delta and Yangtze River Delta enacted strict pandemic controls. Industries including tourism and dining have not recovered, leaving many job-seeking graduates in limbo.  

“This year may be the most difficult for college graduates to find jobs,” Liu Lin said. 

Enrollment vs Options 
“In China’s past development stages of rapid urbanization and industrialization, the focus for employment was on attracting migrant workers from rural areas,” Zeng said. “But as urbanization improved, college graduates have become the focus of employment for China.”  
“Expanding enrollment in higher education... has become a ‘reservoir’ to help ease employment pressure,” Qu Yue, director at the Institute of Population and Labor Economics, Chinese Academy of Social Sciences. “But this is more like taking painkillers, which doesn’t cure the disease,” Qu said.  

As the number of college grads grows, employment demand in traditional industries has decreased. Real estate, education and internet-based sectors were hit first. According to the 2022 Autumn Recruitment Market released by 51job.com, real estate and education fell from the top 10 sectors, with demand only 57 percent and 61 percent of what it was in 2020. Liu Lin said that education alone employed up to one million college grads in 2020, but this year demand is virtually non-existent.  

“Over the past two years, the internet, education and healthcare were the primary employers of fresh graduates... but this year it’s clear that recruitment in these industries has become more sporadic,” Liu Lin said.  

In the internet sector, the situation is much more complex. “Internet giants are recruiting new graduates while laying off experienced employees to cut costs,” an industry insider told NewsChina on condition of anonymity.  

Many internet companies promised huge hiring stints for 2022. Tencent said it would offer over 7,000 jobs to new graduates in 2022, an annual increase of over 40 percent. Baidu claims it is to launch its largest-ever campus recruitment with 8,000 offers. Wang Qiang, a mid-level manager at a smaller internet company, told NewsChina that simultaneous mass hirings and layoffs are normal for the industry, while the final headcount definitely drops.  

In the financial sector, strengthened regulation has been the dominant factor since 2017. Along with deleveraging and risk prevention, development slowed, and jobs decreased overall. According to Zhaopin, the financial sector saw a 39.7 percent drop in new job positions, the highest among all industries in Q1 2019.  

Private enterprises are major job creators. But due to the pandemic and other factors, private sector demand, especially from micro, small-and medium-sized enterprises, has decreased significantly. 

Fit for the Job 
As employment preferences among young people change, more will choose to be unemployed as they pass on less-preferred jobs, which stay unfilled, said Jia Nan, former deputy director of the National Bureau of Statistics.  

This trend is most prominent in manufacturing. According to data from the Information Center of the Ministry of Human Resources and Social Security in Q3 2021, manufacturing had the largest demand for professionals (38.7 percent), followed by wholesale and retail (9.7 percent). But college graduates’ job preferences do not match demand. According to the 2021 College Student Employment Research Report by Zhaopin, more than a quarter of all graduates wanted to work in IT, communications, electronics and internet-based industries, followed by real estate, construction, culture, media, entertainment, sports and finance sectors.  

“The employment difficulties graduates have are more of a structural problem where the human resources do not match the needs of job market development,” Qu Yue told NewsChina. For example, the manufacturing industry needs more skilled workers, but the skills graduates learn at universities do not meet demand, so they still need to start from the bottom if they enter the manufacturing industry.  

“College graduates expect to start with office work. They aren’t qualified for engineering positions immediately after graduation. They often need to work production lines for three to five years, but new graduates tend to lack the patience and are unwilling to do factory work after getting a college degree,” said Ma Jiehong, director of the training department at IMS Gear, a multinational gear and transmission manufacturer. 
“Employment demand from enterprises is very high, but it’s not always easy to recruit enough graduates from our vocational school,” said Wang Xuexi, director at Suzhou-based Chien-shiung Institute of Technology. “Every year, there are 12 jobs to every student. Sometimes the ratio is as high as 20 to 1. Even though recruitment demand shrank this year, there are still plenty of positions available for our graduates.”  

“Now more and more graduates from our vocational school hope to continue their education and get bachelor’s degrees to become white-collar workers or civil servants,” Wang said, adding that up to 80 percent in recent years want to pursue this option.  

Zeng believes the reasons are obvious. “Considering the hours and intensity of factory work, coupled with poor conditions such as no air conditioning or even electric fans during summer, how can young people endure it?” Zeng said. 

An online interview session for spring 2022 college graduates was held at Fuzhou City Professionals Reserve Center in China’s southern coastal Fujian Province, February 10

Needed Reforms 
In March, the Ministry of Education launched a nationwide campaign that called on college and university presidents to visit enterprises and work on creating more job options for graduates. The campaign aims to help schools better prepare students to meet the needs of enterprises. 
“We have implemented a system in which the course design for each major adjusts regularly according to the changes in market demand,” Liu Lin said. The short-term challenge, Liu said, is easing employment pressure for college graduates. For schools, that includes expanding graduate school enrollment. “This is not to postpone employment, but a measure to reserve professionals for the development of high-end manufacturing and new service industries,” Liu said, who suggested expanding enrollment up to 100,000 slots for graduate students. 
Liu said the increase in this year’s advanced degree holders mainly stems from the enrolment expansion of high-level vocational schools. Therefore, local governments should create jobs and provide unemployment insurance compensation or employment subsidies.  

Qu Yue highlighted the creation of temporary jobs, such as the high demand for pandemic control workers. For example, Tianjin announced on April 8 it would recruit 1,916 college graduates to conduct pandemic controls in communities across the city.  

In March, the Ministry of Human Resources and Social Security and 10 other government departments announced a campaign to create no less than 1 million internships for college graduates in 2022. Companies that take part in the program provide interns with basic living expenses and insurance for government subsidies.  

Some provinces have taken advantage of the program. Guizhou Province proposed a target of no less than 15,000 internship positions, while Gansu Province plans to offer over 10,000. Zeng said the 1 million-internship target would burden local government revenues.  

“There are few policy tools available in the short term. On the one hand, we can expand the scale of internship programs temporarily to delay graduates from entering the job market, while on the other, we should tolerate a temporary increase in unemployment. We can expect that as pandemic controls improve, the economy will revive and the situation will improve,” Zeng said, adding that more long-term reforms and strategies are needed.  

“To solve the employment issues of college graduates in the long run, we need to build a lifelong human resources cultivation system from a top-level perspective. That is to say, more people can have opportunities to update their skill sets to adapt to changing needs,” Qu said. 
“Colleges and universities should closely correlate their programs to emerging industry development trends and set up information management systems to provide students with stratified, precise and personalized guidance to help them evaluate job options, benefits and risks,” Zeng said. “The government should improve its flexible employment guarantee mechanism for college students, provide social security subsidies, pensions and medical insurance for those who work in the platform economy, and provide policy consultation, financing, physical space and tax reductions to students seeking to set up startups.”  

Zeng said in some aspects, concerning the development of higher education in China, many maintain a planned economy mentality, and the country should shift focus to cultivating professionals who meet job market demands through reform.  

“In general, stable employment for college graduates requires in-depth and systematic thinking about professional cultivation reforms. At the same time, individuals, schools and society need to change their ideas about employment. In the current climate, the time of landing a good job entirely based on an advanced degree is over,” Zeng said.