Despite Economic Boom, Chinese Graduates Face Struggle for Jobs

China is bracing itself for a glut of graduates later this year, with three out of five university leavers expected to join the ranks of the unemployed.

Despite the heightened expectations created by the economic boom, the job market for graduates is shrinking. The authorities say the number of university leavers will increase by 22% to 4.1 million, while the number of positions has shrunk by 22% to 1.7 million. Newspapers are filled with reports of intense competition for jobs, with the pressure driving students to suicide, and stories of graduates who decide to become pig farmers.

The surplus is largely caused by the steep rise in university enrolments, but also reflects a demographic change that is adding people to the workforce faster than jobs can be created. Although China's economy is growing at double digit pace, it is two-thirds less efficient at creating work than it was during the 1980s.

"It is hard to create new jobs in large numbers due to surplus production capacity, more trade frictions and the revaluation of the yuan," Zhang Xiaojian, of the ministry of labour and social security, was quoted as saying by the Xinhua news agency.

According to the government, surplus labour will reach 14 million this year, a million more than last year. This does not include the army of unemployed peasants, estimated to number up to 200 million. Even law graduates are suffering. "At least half of my classmates will be unable to find a job," said Li Qiang, who will graduate from Beijing's Jiaotong University.

But the glut has been good for universities, with many graduates opting for even higher education. Applications for masters and PhD courses are surging.