Economy

Graduating without honours

Too many university students, not enough jobs: why Beijing’s worried

Town and gown: 31 million more of them need jobs too

“The roots of education are bitter, but the fruit is sweet”. Thus thought Aristotle, although plenty of less philosophical types have different views on the rigours of student life.

But let’s give university-goers the benefit of the doubt on their daily regimen: what if the hard work leads to little reward too? China’s leaders know all too well that student dissent can lead to political foment. The lesson: create jobs for graduates or there could be trouble.

So last week, media interest was piqued by the story of Su Lijie. Despite holding a master’s degree from the elite Peking University, Su’s gone back to her village and is painting to make ends meet.

Not canvas – but houses. “I found it very difficult to live in Beijing,” she told the Dahe Daily, “[after I came back] my mother urged me to find a job, so I learned to paint to make a living.”

That wasn’t how Su’s career was supposed to unfold. University degrees have normally been expected to deliver well-paid jobs and a comfortable standard of living, and education has accordingly been a spending priority for families keen to see their children progess. “50% or more of family incomes are put into the development of a college student,” estimates Shenzhen Economic Daily.

More Chinese are studying at a higher level than before (a record 31 million people in higher education last year, or 8 million more than five years earlier). But job creation hasn’t kept pace and more than a quarter of the 6.3 million who graduated last year weren’t able to find work.

Many new graduates struggling for work are now cooped up in cramped apartments on the edge of major cities – the so-called ‘ant tribe’ phenomenon (WiC highlighted the problem in issue 58 last year). Living conditions have scarcely been improved by rampant inflation, with food prices up 11% year-on-year last month, and rents also climbing in many cities. Nor is the outlook for home ownership especially attractive. “When a white collar worker who is successful by any standard cannot afford a home after 10 years of working, something is very wrong with the market and the economy,” warns economist Andy Xie on the Caixin website.

Not everyone is having trouble finding work. The migrant workers that power China’s export machine seem to be more in demand, and pay packets are being increased across the country. “I don’t think it will take as long as five years to double the minimum wage,” Willie Fung, chairman of major lingerie manufacturer Top Form, told the South China Morning Post. “A couple of years will do because of the severe labour shortage.”

The paradox facing Chinese policymakers is that some college graduates may now be earning less than migrant worker who go straight into the workforce. “The starting salary of graduates in many areas has been as low as $230 a month,” reports the Shenzhen Economic Daily, “but the wages of many types of migrant workers have been close to or above $460 a month.”

That’s good news for migrants, of course, but it doesn’t offer much consolation for those that have put so much effort into earning degrees. Nor are they likely to sign up for life in the factory system. “Factory life is painful mentally,” WiC intern Sophia Cheng wrote of her week working in a Shenzhen factory last summer. “It turns you into a human machine.” (See WiC70 for Cheng’s account of her brief stint on the factory line).

Still, an opinion piece in the Global Times last month thought universities could do more to equip graduates with the skills being demanded in the job market. For instance, students studying the humanities are not a natural fit for some of biggest recruiters in construction, manufacturing and resource extraction. Reports in Xinhua this week also estimated that Chinese manufaturers are currently short of four million “senior technicians” and announced government plans for a new network of 1,200 technical training centres over the next decade. Some would be developed to retrain unemployed college graduates, the newspaper said.

Still, for Beijing it is the current state of the graduate job market that is worth watching most closely, especially after recent experience in the Middle East.

As Francis Fukuyama noted last week in the Wall Street Journal, several million unemployed college graduates are far more dangerous to a modernising regime than hundreds of millions of poor peasants.


© ChinTell Ltd. All rights reserved.

Exclusively sponsored by HSBC.

The Week in China website and the weekly magazine publications are owned and maintained by ChinTell Limited, Hong Kong. Neither HSBC nor any member of the HSBC group of companies ("HSBC") endorses the contents and/or is involved in selecting, creating or editing the contents of the Week in China website or the Week in China magazine. The views expressed in these publications are solely the views of ChinTell Limited and do not necessarily reflect the views or investment ideas of HSBC. No responsibility will therefore be assumed by HSBC for the contents of these publications or for the errors or omissions therein.