According to official estimates, youth unemployment in China increased to 17.1 percent in July, the highest level this year, as the world’s second-largest economy faced rising headwinds.
China is grappling with rising youth unemployment, a deeply indebted real estate sector, and escalating trade tensions with the West.
According to state news agency Xinhua, Chinese Premier Li Qiang, who is in charge of economic strategy, appealed on Friday for struggling enterprises to be “heard” and “their difficulties truly addressed”.
The National Bureau of Statistics (NBS) announced the jobless rate among 16- to 24-year-olds on Friday, which increased significantly from 13.2 percent in June.
The carefully followed metric peaked at 21.3% in June 2023, before authorities paused publication of the figures and then adjusted their methodology to remove students.
Nearly 12 million students graduated from Chinese universities in June, increasing competitiveness in an already difficult labor market and presumably explaining July’s strong spike in unemployment.
In May, President Xi Jinping stated that combating youth unemployment should be a “top priority”.
Disappointing data
The jobless rate among 25- to 29-year-olds rose to 6.5% in July from 6.4% the previous month.
The overall unemployment rate was 5.2 percent.
The NBS data, however, provide an imperfect view of China’s total employment condition because they solely cover metropolitan areas.
The fresh unemployment estimates follow other discouraging economic data from Beijing, including figures showing sluggish industrial production despite recent government efforts intended at stimulating development.
Industrial production growth slowed in July to 5.1 percent, down from 5.3 percent in June and falling short of analyst expectations.
Last month, real estate prices in China’s major cities fell further, indicating a slowdown in demand.
Demand for bank loans also fell for the first time in nearly two decades, according to official numbers released earlier this week.
International challenges are also developing, with the European Union and the United States enforcing trade restrictions to safeguard their markets from low-cost Chinese items and alleged unfair competition.