Record Graduate Influx Lifts China’s Youth Jobless Rate to 17.9% in July

China’s youth jobless rate climbed to 17.9 per cent in July, as a record wave of university graduates enters an already crowded labour market, prompting Beijing to step up employment support.

The jobless rate for those aged 16 to 24, excluding students, rose 3 percentage points from 14.9 per cent in June – the last of three straight months of contraction – according to data released by the National Bureau of Statistics on Wednesday.

The rate last July was 17.8 per cent and it then climbed to 18.9 per cent the following month – the highest level since Beijing revised its methodology to exclude students in December 2023.

The uptick in youth unemployment coincides with another record-breaking graduation season, with an estimated 12.7 million university graduates entering the job market this summer, up about 4 per cent from last year.

The influx comes as the broader job market struggles amid slowing economic growth, with many companies trimming headcount or freezing new hiring.

Beijing has launched a range of measures to support youth employment in recent years, ranging from providing hiring subsidies to firms that absorb graduates to pressing state-owned enterprises to offer more positions.

On Tuesday, the ministries of human resources and civil affairs and the Communist Party Central Committee’s Society Work Department issued a notice requiring local authorities to, in principle, open all new community-level jobs to university graduates.

 Localities were also encouraged to develop roles for graduates and to offer companies and social institutions incentives to boost their hiring.

Facing unprecedented competition, many graduates have opted for postgraduate study to boost their prospects or defer entering the workforce, while others are flocking to the public sector to secure coveted “iron rice bowl” jobs valued for their security.

Clare Wang, a 22-year-old product design graduate from Jilin Jianzhu University, is preparing to study abroad for a master’s degree. She said she researched several major domestic employers, but found that most explicitly required a master’s degree, effectively disqualifying her.

Wang added that she lacked the confidence to secure even an entry-level domestic job paying 6,000 yuan ($890) a month, noting that many of her peers also chose to pursue postgraduate degrees.

Graduates from overseas universities face similarhurdles.

“The bar for employment has been raised significantly,” said 24-year-old Vikey Zhao, who has a master’s degree in e-commerce management from the University of Warwick in the United Kingdom. “Even for an entry-level role, the competitors are almost all master’s graduates from top-tier domestic universities.” After sending dozens of applications over six months, she eventually landed a smart-retail role at a state-owned enterprise.

Zhao said she was luckier than several of her friends. They “submitted hundreds of applications, only to receive interview invitations from one or two companies”, she said.

The unemployment rate for those aged 25 to 29, also excluding students, stood at 7.2 per cent in July, up from 7.1 per cent in June.

China’s overall urban unemployment rate in July was 5.2 per cent, up from 5 per cent in June.