China’s economic slowdown and elevated youth unemployment have forced many young graduates to lower their career expectations, with increasing numbers taking up roles below their qualifications. This trend highlights structural challenges in the country’s labour market and the growing allure of stable government jobs, despite their own emerging vulnerabilities.
A Competitive Job Market
The current economic climate, marked by a sluggish recovery, has left millions of young graduates struggling to find work in their chosen fields. Official youth unemployment figures stood at 16.1% in November 2024, slightly down from earlier peaks but still a cause for concern. The oversupply of university graduates has resulted in underemployment, with positions in private equity or investment banking increasingly hard to secure.
This disparity has seen individuals like Sun Zhan, a 25-year-old with a master’s degree in finance, taking up jobs as waiters, delivery drivers, and cleaners. Sun, who now works in a hotpot restaurant in Nanjing, views his role as a stepping stone to one day owning his own business, despite his family’s disapproval.
The Civil Service Appeal
For many, the “iron rice bowl” promise of government jobs—a term denoting lifetime stability—has become an attractive alternative. This year, a record 3.4 million people applied for China’s civil service exam, a surge of over 400,000 compared to 2023 and triple the number from a decade ago. Applicants, including graduates from prestigious institutions, are lured by the perceived job security, subsidised housing, and social insurance benefits that public sector roles offer.
Klaire, a master’s student in Beijing, is among those seeking government employment. Having studied for nine hours a day to prepare for the notoriously competitive exam, she views civil service as a refuge from an unpredictable private sector. “I don’t wish to make lots of money; I just want stability,” she explains.
Emerging Challenges in Public Sector Roles
However, the appeal of government jobs is tempered by growing challenges. Widespread fiscal crises in local governments have led to delayed salaries, wage cuts of up to 30%, and the elimination of bonuses. In some provinces, civil servants have reported receiving paychecks only sporadically, with some surviving on as little as 4,000 yuan (£450) per month while supporting families and repaying loans.
Katherine Lin, a former civil servant in Shenzhen, resigned after her salary dropped by 25% and bonuses were scrapped. Cost-cutting measures in her department included salary reductions and staff layoffs, reflecting broader austerity trends across the public sector.
Private Sector Layoffs and Perceptions
In contrast, the private sector—once a significant employer of graduates—has seen widespread layoffs in industries like technology and manufacturing. This has further reinforced the appeal of civil service roles among young Chinese, many of whom are disillusioned by the instability of private-sector jobs. A social media meme encapsulates the sentiment: “Becoming a civil servant is the endpoint of the universe.”
Yet, many young people entering the public sector carry an idealised view of its benefits, having grown up after the mass layoffs of the 1990s. As some civil servants describe their financial situation as “stable poverty,” the reality is increasingly at odds with the perception of guaranteed stability.
Underemployment and Social Consequences
The mismatch between educational attainment and employment opportunities has broader implications. Underemployment among young people can lead to dissatisfaction, reduced productivity, and social unrest. For some, temporary roles, such as acting as film extras in Hengdian’s movie studios, serve as stopgap measures while they search for permanent solutions.
At the same time, many graduates are exploring unconventional paths. Wu Dan, who earned a finance degree, transitioned to training as a sports injury massage therapist, citing her interest in sports medicine despite initial familial disapproval. Her experience reflects the growing trend of young people redefining career success.
Dreams Deferred
China’s leaders face the dual challenge of fostering economic recovery while addressing the structural disconnect in the labour market. Reforming the public sector, which has swelled to 8 million civil service roles and an additional 31 million public positions, is critical. However, experts caution that wage arrears and inefficiencies are “systematic and universal,” likely to persist without significant policy changes.
As young graduates grapple with an uncertain future, many are adopting a pragmatic approach, opting for stability over ambition. The long-term consequences of this shift, both for individuals and the broader economy, remain to be seen. For now, the current generation of Chinese graduates must navigate a job market that often falls short of their expectations, balancing aspirations with the realities of a slow-growing economy.
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