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Prof. Lu Feng: Try All Means to Get the Young into Jobs

Jul 03-2023   



Since the launch of the reform and opening up in 1978, China’s young people have never experienced such a tough time finding jobs as now, said Prof. Lu Feng of the NSD in a media interview. Any measures that help the youth getting employed are conducive, he said.

 

An official survey of urban population found that 20.8% of those aged 16-24 were unemployed in May, touching a new height since the first release of the statistics in January 2018. Prof. Lu estimated that such a plateau of youth unemployment rate was likely to persist into the next two to three years.

 

Unemployment rates diverge starkly among different age groups. While that of the young jumped from 17.3% in January to 20.8% in May this year, the overall urban unemployment rate declined from 5.6% in February to 5.2% in May. Those aged 25-59 saw their unemployment rate move down to 4.1% in April, lower than that in the same period of 2019 (before the pandemic).

 

Prof. Lu identified several causes of youth unemployment. The unprecedentedly high numbers of university graduates in 2022 and 2023 – and perhaps in the upcoming three to five years – strain the employment situation and are compounded by frictional unemployment. The macro-economy, though in recovery, hasn’t instilled enough confidence in enterprises, especially the SMES, which remain cautious in adding staff. Their hesitance is reinforced as they weigh the possibilities of using AI, instead of hiring.

 

To break the predicament, the essential solution is to maintain the economic growth rate, said Prof. Lu. The current macro policy focuses on cross-cycle regulation, which Prof. Lu advised should be replaced by a counter-cycle one at a proper time and to an appropriate degree. Another measure is offering substantive support to private enterprises to enhance their confidence and expectations; otherwise, they might refrain from hiring the young. What also needs to be improved is regulatory oversight. If it becomes more transparent and acts according to relevant laws, then its impact on employment will be mitigated. A case in point is its effect on private tuition, real estate, and the internet industry in 2021, all of which used to be big employers of young people. Lastly, Prof. Lu said that current job-promoting policies should remain in effect, including supporting SOES to enlarge recruitment scale, maintaining the number of positions in governments and affiliated agencies, as well as pushing forward a plan by the Ministry of Human Resources and Social Security (MOHRSS) and some other ministries to pool one million internships for the youth.

 

Prof. Lu has dedicated many years to the research on macro-economics. He used to be an expert member of advisory teams for the Ministry of Finance, MOHRSS, and ASEAN+3 Macroeconomic Research Office (AMRO).

Prof. Lu Feng: Try All Means to Get the Young into Jobs

Jul 03-2023   



Since the launch of the reform and opening up in 1978, China’s young people have never experienced such a tough time finding jobs as now, said Prof. Lu Feng of the NSD in a media interview. Any measures that help the youth getting employed are conducive, he said.

 

An official survey of urban population found that 20.8% of those aged 16-24 were unemployed in May, touching a new height since the first release of the statistics in January 2018. Prof. Lu estimated that such a plateau of youth unemployment rate was likely to persist into the next two to three years.

 

Unemployment rates diverge starkly among different age groups. While that of the young jumped from 17.3% in January to 20.8% in May this year, the overall urban unemployment rate declined from 5.6% in February to 5.2% in May. Those aged 25-59 saw their unemployment rate move down to 4.1% in April, lower than that in the same period of 2019 (before the pandemic).

 

Prof. Lu identified several causes of youth unemployment. The unprecedentedly high numbers of university graduates in 2022 and 2023 – and perhaps in the upcoming three to five years – strain the employment situation and are compounded by frictional unemployment. The macro-economy, though in recovery, hasn’t instilled enough confidence in enterprises, especially the SMES, which remain cautious in adding staff. Their hesitance is reinforced as they weigh the possibilities of using AI, instead of hiring.

 

To break the predicament, the essential solution is to maintain the economic growth rate, said Prof. Lu. The current macro policy focuses on cross-cycle regulation, which Prof. Lu advised should be replaced by a counter-cycle one at a proper time and to an appropriate degree. Another measure is offering substantive support to private enterprises to enhance their confidence and expectations; otherwise, they might refrain from hiring the young. What also needs to be improved is regulatory oversight. If it becomes more transparent and acts according to relevant laws, then its impact on employment will be mitigated. A case in point is its effect on private tuition, real estate, and the internet industry in 2021, all of which used to be big employers of young people. Lastly, Prof. Lu said that current job-promoting policies should remain in effect, including supporting SOES to enlarge recruitment scale, maintaining the number of positions in governments and affiliated agencies, as well as pushing forward a plan by the Ministry of Human Resources and Social Security (MOHRSS) and some other ministries to pool one million internships for the youth.

 

Prof. Lu has dedicated many years to the research on macro-economics. He used to be an expert member of advisory teams for the Ministry of Finance, MOHRSS, and ASEAN+3 Macroeconomic Research Office (AMRO).