SHANGHAI, June 1, 2024 (BSS/AFP) - At a job fair for soon-to-be graduates in
central Shanghai, recruiters sat bored under washed-out tarpaulins as rain
and an apparent lack of interest kept potential young employees away.

The empty seats belied China's stubbornly high youth unemployment rate -- a
problem so pressing that President Xi Jinping this week told top Communist
Party (CCP) cadres it should be a "top priority".

His words have been seen by many analysts as a signal that reforms could be
in the pipeline ahead of July's Third Plenum, a meeting that has historically
unveiled important changes in economic policy direction.

Youth unemployment stood at 14.7 percent in April, official data showed --
and in June, another 11.8 million students will graduate from university,
adding to the bottleneck.

That number had soared to an unprecedented 21.3 percent in mid-2023, before
officials paused publishing monthly figures. They began releasing them again
in December after adjusting the calculation method.

Hospitality and human resources firms dominated Friday's small job fair, one
of many hosted by local authorities over recent weeks in anticipation of the
imminent influx of university leavers.

"It's difficult to find a job that matches your degree and aspirations," one
of the few young jobseekers at the fair, a data sciences student, told AFP.
 
"Lots of college students actually have too high expectations," said Julia
Shao, who was recruiting for a restaurant chain.

"They do not prefer this kind of basic position. They prefer... a fancy job."

- 'Policy shift underway' -

Xi specifically mentioned graduates in his speech to the CCP Politburo on
Monday, noting that "more jobs should be created for them to apply what they
have learned and what they are adept at".

His remarks follow "a steady drumbeat of comments from China's leadership
underlining the urgency" of the matter, Erica Tay, director of macro research
at Maybank, told AFP.

The issue has been hanging over the government for some time.

Together with persistently low consumption and a long-running property sector
crisis, the unemployment situation has been labelled a key culprit for
China's uneven post-pandemic recovery.

"While details in Xi's comments are vague, it's clear a policy shift is
underway," said Harry Murphy Cruise of Moody's Analytics.

"We expect policies aimed at reducing youth unemployment to be a key pillar
of the discussions (at the Third Plenum)."

In the remarks published Monday, Xi said young people should be encouraged
"to find jobs or start businesses in key fields (and) industries".

"Market-oriented and social channels should be expanded for young people to
find a job," he was quoted as saying.

Murphy Cruise said he expected the government to increase wage subsidies to
persuade companies to hire recent graduates, as well as create more work
placements for students.

However, these were only "band-aid solutions", he said.

In the long term, "larger industrial and education policy reforms" were
needed to ensure a better match between graduates' skills and employer
demands, he said.

- 'Lower expectations' -

There is now a push to fill roles that "dovetail with key policy priorities"
or where skills shortages exist, said Tay, like industrial upgrading and
scientific innovation.

With job opportunities drying up for those holding sociology, journalism and
law degrees, she said, some kind of "government-sponsored earn-as-you-learn
training programmes" might be needed to fill more in-demand roles.

Near the law faculty of a top Shanghai university, final-year students said
the job market was indeed tough.

"Post-pandemic, it is a little more difficult than before," 22-year-old Qian
Le said, referencing recent lay-offs and pay cuts at top Chinese law firms.
 
"Even those who are already in jobs may not be able to keep them, so it may
be more difficult for new people to get in."

Qian and her classmate Wang Hui had both opted to pursue further study.

"The economic situation is quite sluggish, many companies have gone bankrupt,
and many jobs have been reduced," Wang told AFP.

China's once-freewheeling private sector has slowed significantly, in part
because of past government crackdowns on companies including tech giants and
private tutoring firms.

Many young people are opting to study for civil service exams -- seen as a
more stable option -- or like Wang and Qian, taking on post-graduate degrees.

In March, universities urged their students to actively look for jobs
instead, said Tay.

But "competition is huge, and the number of undergraduates is gradually
increasing every year", Wang said.

Karl Hu, another law student, said the difficulty was not in finding a job.
 
The problem was finding "a suitable career" in terms of salary level and
benefits, he explained.

He himself had secured a good job at a bank, he said -- but many would have
to "lower their expectations".