Youth unemployment emerging as major problem in China: Report

New Delhi, April 9 Youth unemployment is emerging as a major problem in China which is raising a question mark on the Asian giant’s “economic miracle.” World Bank estimates put youth unemployment at about 17.7 per cent in 2025, reflecting slower job creation amid an increasing number of university graduates entering the labour market.

Official data released in 2025 showed unemployment among those aged 16–24 rising to 16.9 per cent. Social media amplified the issue when a PhD graduate revealed he had turned to food delivery work, while a gas company announced it was hiring graduates as meter readers, according to an article in Eurasia Review.

Each year, millions of new graduates join the job market, intensifying competition. In 2026 alone, China expects more than 12 million university graduates, prompting policymakers to look to new sectors — such as artificial intelligence — for job creation. Yet many graduates end up in temporary or low-paying jobs unrelated to their studies. Others rely on family support or delay major life decisions such as marriage, home ownership or starting a family, the article states.

Prominent economist Gao Shanwen at a recent investor conference described China’s young people as “lifeless”, remarks later scrubbed from the internet by censors. “China is now full of vibrant old people, lifeless young people and middle-aged people in despair. Young people are tightening their belts and eating noodles with the lights off,” the article cites Gao as saying.

The article further states that across cities from Beijing to Chengdu, youngsters are seeing a sharp decline in purchasing power, uncertain employment prospects and an economic environment where the government increasingly relies on subsidies to stimulate consumption. For many young Chinese, the promise of prosperity that once accompanied education and hard work now feels increasingly distant.

It highlights that China has rolled out consumer subsidy programmes to encourage people to replace old household appliances, vehicles and digital devices. These programmes, which began in 2024, expanded significantly in 2025 and 2026 as part of a nationwide effort to revive weak demand.

“For a generation that once drove China’s consumption boom, buying even moderately priced appliances without government assistance has become increasingly difficult. Subsidies are no longer just incentives; they are becoming a structural tool to prop up fragile demand,” the article states.

The ripple effects of this uncertainty are visible across the consumer economy. Domestic demand remains soft despite stimulus efforts. Retail sales growth spikes during subsidy campaigns, but economists warn it is unsustainable, driven by government incentives rather than genuine consumer confidence.

OECD projections show China’s growth slowing from about 5 per cent in 2025 to roughly 4.4 per cent in 2026, as aggregate demand declines due to cautious household spending and high savings rates.

The property sector— once the backbone of household wealth — has also weakened. Falling housing prices and reduced investment have eroded household balance sheets, further discouraging spending. At the same time, questions have been raised about China’s official growth rate figures.

Commentators note that the numbers are “systematically inflated” due to calculation methods, though they argue it is unlikely the central government manipulates the data directly, the article added.

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