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The Paradox Of China’s Job Market, Where Opportunities Are Abundant, But Unemployment Rate Is On An Upward Trend 

21 April 2021

Chinese job seekers, especially young graduates, are finding it increasingly difficult to enter the job market and at the same time the country’s biggest recruiters are struggling to bolster their workforce.

While the situation may seem baffling, considering the presence of both employment supply and demand, it could simply be the latest manifestation of an ongoing shift in China’s socioeconomic structure. 

Despite the devastating blow dealt by the COVID-19 pandemic to employment prospects worldwide, China’s job market seems to show consistent signs of recovery with the unemployment rate dropping as low as 5.4 percent in the first quarter of 2021, according to an April 16 release by the Chinese National Bureau of Statistics (NBS).

However, these latest numbers do not accurately capture the reality of the employment scene in the world’s most populous nation. 

In fact, official government reports released in March 2021 revealed that the unemployment rate is on an upward trend and has reached 13.6 percent among young people between the ages of 16 and 24, especially those who have recently finished their higher education.

Judging by the difficulty young people are experiencing in terms of landing a job post-graduation, one might make the assumption that the problem lies in the scarcity of opportunities available for the country’s ever-expanding workforce.

While that may be true for certain companies that include those owned by the Chinese government and foreign businesses operating in China, whose demand of employees has steadily declined according to the Chinese recruitment online platform Zhaopin, other industries, namely large industrial enterprises, are surprisingly suffering a shortage of workers raging across different skill levels.

Among over 90,000 surveyed companies based in provinces where the economy has been booming, the NBS reported that a whopping 44 percent have had trouble luring potential employees.

According to the Hong Kong-based newspaper South China Morning Post, a potential explanation for the contradictory, yet somehow co-existing phenomena of job scarcity and worker shortage is the slow and steady increase in the number of Chinese rural residents moving to cities in search of work, which has exceeded 170 million in the first quarter of 2021 —an increase of 2.46 million in the span of just two years.

Regardless of whether there are other factors at play, it would be fascinating to see how internal migration continues reshaping the Chinese job market and society as a whole in the years to come. 

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