Chinese graduates grappling with unprecedented job scarcity

[Dave Grubb]

Urban youth unemployment for the roughly 100 million Chinese aged 16-24 spiked to 17.1% in July, a figure analysts say masks millions of rural unemployed.

China suspended releasing youth jobless data after it reached an all-time high of 21.3% in June 2023, later tweaking criteria to exclude current students.
Over 200 million people are currently working in the gig economy and even that once fast-growing sector has its own overcapacity issues. A dozen Chinese cities have warned of ride-hailing oversaturation this year.
Redundancies have even spread to government work, long considered an "iron rice bowl" of lifetime employment.
Last year Beijing announced a 5% headcount reduction and thousands have been laid off since, according to official announcements and news reports. Henan province trimmed 5,600 jobs earlier this year, while Shandong province has cut nearly 10,000 positions since 2022.
Meanwhile, analysts say China's 3.9 million vocational college graduates are mostly equipped for low-end manufacturing and service jobs, and reforms announced in 2022 will take years to fix underinvestment in training long regarded as inferior to universities.
China currently faces a shortage of welders, joiners, elderly caregivers and "highly-skilled digital talent", its human resources minister said in March.

Could not be happening to a nicer bunch

This comes as no surprise to anyone watching that political/economic game.

The genie is out of the jar---and it isn't going to go back in because they say it should

Ten years ago they wanted a nice bike---today they want a new apartment and a new car

[UTAH]

I'd go for the iron rice bowl. Wifey and I purposefully retired right before retirement time/ages were raised, which was concurrent with benefit cuts.

When it comes to retirement pay and benefits, I recommend being selfish. Cause once you're on the outside looking in, your ability to make changes evaporates. We don't have our rank or status tattooed on our foreheads when we retire. We simply become the nice old couple that lives next door.

Hunter

[Dave Grubb]

I need to clarify a comment in the original post:

Could not be happening to a nicer bunch

The "bunch" does not refer to the person on the street---they are victims of the ruling party. It is the ruling class (party members) who are culpable in this fiasco, and it only begins at the top, it runs all the way down to local "officials".

They carved out a huge piece of the economy for their selfish wants--and now the financial manipulation has come home to roost. The international gold market has been astounding of late---driven by Chinese investors who have come to grips with their bleak economic future.

[UTAH]

Doing some legwork, I came across a Harvard Business Review attesting to strengths of China’s Economy.

As we began the 21st century, China was leading in, "53 out of 64 critical technological fields." That was no coincidence, as China was reaping the benefits of R & D investments, which, "...soared from $18.2 billion to $620.1 billion — a 3,299% increase compared to America’s 277% (The 4 Key Strengths of China’s Economy — and What They Mean for Multinational Companies)."

'Course, as Dave has shown, that economic leap forward did not have lasting impact. Further, it's questionable if China can now afford to invest at such a stratospheric level again. The USA, and its allies, are actively investing in technology and manufacturing methods that are not dependent upon Chinese raw materials or workforce (e.g., Rare Earth Elements).

Hunter

[Dave Grubb]

You did your homework

The burst of dominance (and some of it remains) cost me my job in 2003. Our then CEO was hell bent on moving manufacturing to China---it had to be the thing to do, everyone else was doing it. I was the fly in his ointment and continually frustrated his plan. When you are a VP in conflict with the CEO only a fool can't foresee the future. My only solace was that it cost him a bunch to send me on my way

In the final analysis very little remains in China.

[Honda]

The United States owes China over 800 billion dollars.

[UTAH]

Is it correct to assume that billion-dollar debt is tied to a trade imbalance?

Hunter

[Honda]

No actually it is the debt that China owns. However, if you dig deep into the transaction you will see that there are some complex transactions involved. You should trust me because I took economics 101 and 102 in college.

[Dave Grubb]

The United States owes China over 800 billion dollars.

That is taking a very complex subject to extreme simplification and misunderstanding.

First, let me point out that China is in default on a trillion dollars in debt to US bondholders.

A beginning of understanding the true nature of this claim begin here.

BTW---the 800 number likely comes from US Treasury notes purchased by China, none of which are in default.

Added in edit: It is also worth noting that Japan holds more US Treasury notes than China.

[Dave Grubb]

On related news comes this from a recent article in the WSJ:

Trillions in Hidden Debt Drove China’s Growth. Now It Threatens Its Future.
Local governments racked up as much as $11 trillion in off-the-books debt to build industrial districts, resorts, transit systems and housing projects, including many that failed

Some of these projects resemble modern ghost cities.

[UTAH]

Yeah, which is why I'm thinking their leading industrialists won't want to put up substantial funding again. For, when they did it before, it did not produce long term change.

Hunter