Rising Youth Unemployment in China Threatens Economy and International Relations
The Growing Problem of Youth Unemployment in China
In May, youth unemployment in China reached a record high of 21%, causing concern not only for China’s economy but also for the global economy.
A Mismatch Between Job Openings and Youth Aspirations
One of the major issues contributing to this problem is the mismatch between available job openings and the career aspirations of Chinese youth. Most well-educated Chinese graduates prefer service sector jobs like computer science, but there simply aren’t enough positions available in this sector. This results in a waste of their skills and a lack of productivity.
The Potential Impact on the US Economy and Trade
The high youth unemployment in China could have significant consequences for the US economy, as the country heavily relies on China for goods and services. Despite efforts to decouple from China, it remains the third largest export market for the US. Diminished productivity in China could strain the US and lead to fewer export opportunities for American companies.
Challenges in China’s Economic Management
Benn Steil, a senior fellow at the Council on Foreign Relations, argues that this youth unemployment crisis is a direct result of poor economic management in China. The government has not made enough efforts to expand job opportunities in the service sector, instead focusing on sectors like property and construction that have historically been unproductive.
Potential Consequences for China and Beyond
A prolonged youth unemployment crisis in China could have serious consequences, including civil unrest and political instability. It could also threaten trade and supply chains, leading to broader international relations issues.
The Vulnerability of Chinese Youth in Economic Downturns
Youth populations are particularly vulnerable during economic downturns, as they have less work experience and are more likely to face uncertainty. The stakes are high for China to address these imbalances, as the youth population plays a crucial role in driving consumption in areas such as culture, education, and transportation.
The Rise of ‘Full-Time Children’
In response to the lack of job opportunities, many recent college graduates have resorted to becoming ‘full-time children.’ This refers to adult children who stay at home with their parents and perform household tasks due to their inability to find employment elsewhere. However, this is not a sustainable solution and further exacerbates the unemployment crisis.
The Potential Consequences for China’s Future
If China fails to address the growing youth unemployment problem, it could lead to a mass emigration of young people, a decline in Chinese student numbers overseas, and a brain drain as talented individuals choose to stay abroad. This would be detrimental to China’s long-term economic growth.
A Call for Action
The youth unemployment crisis is a pressing issue that requires immediate attention and action from the Chinese government. Expanding job opportunities in the service sector and ensuring that the skills acquired by college graduates align with the available jobs are crucial steps to mitigating this crisis and securing China’s economic future.
Source: Educated Gen Zers in China are choosing not to work. It could be a problem for the US economy.
