With an increasing number of China’s college graduates delaying their entry into the job market, economists are warning of dire implications and ripple effects if the trend persists or intensifies. Authorities have also repeatedly stressed the importance of creating and finding jobs for the nation’s ever-growing army of fresh graduates, and the situation was again addressed by China’s top economic planner this week. “Various employment policies will favour college graduates, and assistance will be provided more precisely to them,” the National Development and Reform Committee vowed in an article published on its official WeChat platform on Sunday. This comes as graduates are also seeking more stability in their careers. Many are opting to take their time before entering the workforce, while others are forgoing high-paying private positions for less-demanding civil service positions. Why are China’s fresh grads now saying no to high-paying ‘996’ jobs? But the fact that fresh grads are postponing employment could pose a serious threat to China’s economy, according to Wang Dan, chief economist with Hang Seng Bank (China). She pointed to the potential impact on the property market and on China’s demographic crisis. “As many of them don’t have an income and choose to live with their parents, the need for new housing will decrease,” Wang said. “[Their unemployment] will have a more far-reaching effect,” she added. “ This educated group of young people will not get married nor have kids when they are unemployed with uncertain income prospects. So, the age of marriage will be further delayed while the birth rate will keep dropping . This is a bad sign for China’s economic development.” The unemployment rate among those aged 16 to 24 was 14.3 per cent in December, according to the National Bureau of Statistics. And the rate for people aged 20 to 24 has remained higher than 20 per cent, according to Li Yang, director general with the Institute of Finance and Banking at the Chinese Academy of Social Sciences. Meanwhile, amid growing competition in the job market, which is intensified by millions of new graduates every year, more young people say they are holding off on securing work because they want to prepare for civil service exams , or they intend to get a teaching certificate. A record 10.76 million graduates are expected in China this year – 1.67 million more than last year’s record . This doesn’t include the large number of competitive candidates who graduated from overseas universities and are also seeking jobs back home amid the global pandemic. Competition for jobs has been further intensified by lay-offs resulting from China’s regulatory clampdowns on a number of sectors, including tech companies, private tutoring and real estate – all of which used to be highly sought-after industries for new graduates. According to a survey published by employment service platform Zhaopin in May, only 56.9 per cent of the class of 2021 chose to take a full-time job after graduating from universities, compared with 75.8 per cent in 2020. China jobs: inside the world’s biggest workforce The proportion of people choosing freelance work also rose from 7.7 per cent in 2020 to 15.8 per cent in 2021, Zhaopin said. And 12.8 per cent of graduates chose to postpone their employment last year, more than double the 6.2 per cent in 2020. Some opted to take a gap year, but many wanted to focus on preparing for the national civil service exam. Additionally, the data showed that 11.4 per cent of graduates were pursuing higher degrees either domestically or abroad last year, up from 7.5 per cent in 2020. “College students are demanding increasingly high starting salaries, while companies’ offerings have remained largely unchanged,” said Li Qiang, executive vice-president of the recruitment service. “This leads to a mismatch on both sides. Many students are waiting to land an ideal salary, while companies are having a difficult time hiring the right people.”