Catering for the market: China’s graduate employment problem

SINCE the end of the 1990s, the higher education sector in China has expanded rapidly. This expansion is both the inevitable consequence of the increase in the number of high school graduates and the result of the Chinese government policy in response to the Asian financial crisis of the time. At the end of the 1990s, the Asian financial crisis swept through all of Asia and brought with it terrible losses for many economic entities. In order to subdue its negative effects, China implemented proactive economic policies and tried to stimulate internal demand through large-scale investment in infrastructure. Encouraging consumption was another important tactic. The expansion of higher education, then, became an important policy decision to attract more families to invest their savings in education and thereby stimulate economic development. According to statistics from the Chinese Ministry of Education, since 1994 the number of ordinary undergraduate colleges has doubled, and the number of full-time undergraduates has increased by 700 percent (see figure 1). However, the continued expansion of higher education and the increased number of full-time undergraduates put serious pressure on employment, because, when they finish university, the majority of graduates immediately enters the job market. Since 2003, when the first group of students who enrolled in the expanded system graduated, the state of graduate employment has become increasingly grim. According to statistics from the Chinese Ministry of Education, in 2008 the total number of ordinary university graduates was 5.59 million; by 2009, this figure will reach 6.11 million. The Chinese Academy of Social Sciences recently published its 2009 Economics Blue Book, where it predicted that by the end of 2008 there will be one million graduates who are unable to find a job. Graduates being unable to find a job quickly will undoubtedly bring economic pressure on them and their families. Since 1978—and especially since 1993 when the “Outlines for the Reform and Development of Education in China” were promulgated—the Chinese government has always tried to achieve the reform of the higher education system by engaging with market forces. The reform of the means by which graduates enter employment was part of these market reforms. The post-reform employment system emphasised that each individual had the right to free choice when it came to finding a job, abandoning the method where the state would allocate work directly. In this way the pressure of finding a job was transferred from the state onto individuals and their families. As for the nature of the difficult problem of graduate employment, there is still much debate in China. Some people think that the government’s policy of blindly increasing enrolment and its focus on over-industrialisation violate the fundamental rules of expanding education. Because at this stage there is a limited amount of job opportunities that can be created by the various industries and the government, and an excessively large higher education sector, this means that there will be a surplus of highly skilled workers, as well as using up the limited amount of resources for education