While unemployment among the urban population of China was only around
5.2 per cent in April, the official numbers from the National Bureau of Statistics showed that more than 20 per cent of the 16-24 demographic was unemployed. This problem will be further exacerbated as 11.6 million fresh college graduates hit the job market. Policymakers are insistent on holding meetings to tackle the issue but the only measure taken so far is to increase hiring among state governments that are already heavily in debt. With the average income of a fresh government employee being extremely low, this does not bode well for economic recovery and job growth. The disappearance of entrepreneurs and targeting of the financial sector means further outflow of capital and increasing likelihood that this number will increase. Another factor increasing the likelihood of unemployment rising is that slow economic recovery after victory was declared over the pandemic. After four months of reopening, we can clearly see that consumers are skittish about purchasing and production levels have not even close to reached pre-pandemic levels.
A particularly troubling rumour is that Xi Jinping will take a page out the Mao playbook and drive millions of unemployed youths to rural China in order to maintain the Party’s grip on power and prevent any uprisings. The nearly 30 million youth who are constantly being fed propaganda about the growth of China and endless prosperity faces a greater disappointment than unemployment. Information from the Tsinghua PBCSF Global Finance Forum held in Beijing on May 20th shows that local government debt in China exceeds $9.4 trillion and Xi Jinping is convinced about the need for “common prosperity” by means of a rural revival drive. Another consensus established was that this investment in reducing the rural urban wealth gap would by no means go towards the agricultural sector as it was not a “wise” investment destination. Pouring money into building infrastructure is even more meaningless as more and more people are migrating to the urban environment.
At the same time as the Forum was being held, officials were working overtime as “520” or “I Love You” in Chinese is an important day for young couples to get married. As China recently announced initiatives to strengthen childbirth and encourage the youth to marry, one wonders on how effective a government policy will be in terms of reducing a cultural trend of asking for a high ‘bride price’. While the elderly CCP worries about maintaining a young labour force over the long term, this does not solve the immediate problem of unemployed youth being in no mood to marry and produce babies. If the CCP chooses to force the unemployed into the rural areas, it will end any chance of economic recovery and ensure that the aging of the demography is set in stone. While Xi Jinping has brushed this off as a common problem among developed countries, the reality is that the wealth distribution is extremely disparate within China.
Until we see cultural changes in terms of corruption and bribery, it is unlikely that meaningful social change will happen. The large majority of poverty stricken Chinese youth are increasingly focused on stability with aspirations of accumulating wealth slowly but surely.
The definition of a working population is said to be between the ages of 15 to 64. While this number was 997 million out of a 1.4 billion population in 2014, it reduced to around 986 million in 2021. However projections estimate that due to the one child policy, this number will hit around 378 million people in the 2030. Faced with an increasingly hopeless future, memes on social media abound about Kong Yiji, a poor scholar who refused to do manual labour in writer Lu Xun’s short story. Faced with a government that does neither value their education nor an economy that guarantees their livelihood, unemployed youth are increasingly spreading the message about ‘lying flat’. At the same time, desperation has driven huge number of people into the gig economy, with millions registering as drivers on ride-sharing apps. However, this only led to gridlock within cities and a failure to increase income levels due to over saturation of the sector. Another story making the rounds are the increasing layoffs from tech giants and the rise of the street stall economy. After years of trying to remove this sight from developed cities, the government is not reversing its policy on the issue in order to reduce social pressure. One can only fondly reminisce about the former premier Li Keqiang, who proposed the same plan several years ago. We have already seen the CCP back down in the face of widespread protests when it comes to its zero-COVID policy. The question now arises as to whether this generation will meekly accept the policy of “Going to the Countryside”. It is increasingly evident that the CCP is panicking over how to handle the unemployment crisis as the propaganda machine is working overtime to churn out fake news about getting rich in jobs that are not white collar. At the same time, huge backlash was generated after the Youth Communist League criticized unemployed youth for being too proud to ‘go to the farmland’. With geopolitical risks leading to the collapse of private capital, China refuses to provide a stable environment and instead threatens foreign firms with trumped up espionage charges. The decline of human rights continues in China with a LGBT rights group announcing its closure due to ‘force majeure’. While none of these are directly related to the problem of unemployment, it shows a worrying glimpse at the future actions of the CCP. When unemployed youth try to voice their dissatisfaction in the future, it is inevitable that they will be perceived as a nail and the hammer will follow. The previous “Lost Generation” only went to the countryside and failed to get access to higher education. The uncertainties of unemployment will definitely increase, but will it led to the collapse of a generation is yet to be seen.