China job market improves marginally in June, dashing hopes of V-shaped rebound even as economy returns to growth

China’s official surveyed jobless rate fell to 5.7 per cent at the end of June from a peak of 6.2 per cent in February, amid a broad-based economic recovery
But newly added jobs in the first half of the year were down about a quarter compared to a year ago, official data showed

China economy

Sidney Leng

Published: 6:44pm, 16 Jul 2020

Why you can trust SCMP

China’s job market, even by official figures, showed only marginal improvement in June with one out of five people in their early 20s being unemployed, despite a sharp second quarter rebound in gross domestic output from a 6.8 per cent contraction in the first three months of the year.

The official surveyed unemployment rate in urban areas dropped to 5.7 per cent at the end of June, from a reading of 5.9 per cent at the end of May and a peak of 6.2 per cent at the end of February, according to data released by the National Bureau of Statistics on Thursday.

While the unemployment rate among those aged between 25 and 59 fell to 5.2 per cent last month, from 5.4 per cent in May, the rate for people aged between 20 and 24 with a college degree or above – many of whom are fresh graduates – rose to 19.3 per cent. That was 2.1 percentage points up on May and 3.9 percentage points higher than the same period last year.

One of the key indicators monitored by the government on job creation – newly employed people – dropped to 5.64 million in the first half of the year, which was 1.73 million less than a year ago, the statistics bureau said.

China’s official surveyed unemployment rate in urban areas dropped to 5.7 per cent at the end of June, from a reading of 5.9 per cent in May. Photo: AP

At the same time, about 177 million Chinese migrant workers had left their rural homes for urban jobs at the end of June, down 2.7 per cent from a year earlier, according to government data. That meant about 5 million migrant workers had chosen to stay at home.

The official job statistics showed that the recovery of the world’s second biggest economy is unbalanced, although a 3.2 per cent headline growth rate in the second quarter has made China the world’s first major economy to shake off the shock of the coronavirus pandemic.

Ensuring steady employment has emerged as a top priority for the Chinese leadership, who see it as key to social stability. But the task has become more difficult this year with the pandemic, US-China decoupling and widespread flooding in southern China all hitting the economy just as a record-high 8.74 million graduates from universities and colleges entered the job market.

A separate survey tracking supply and demand for jobs on a quarterly basis showed that there are more jobs in the second quarter than the first in 2020, but the number of available positions is far behind the level a year ago.

The survey by China Institute for Employment Research from Renmin University of China, which is based on data from recruitment site Zhaopin, showed that job posts in the second quarter were down nearly 10 per cent from a year earlier while the number of jobseekers surged by more than 25 per cent – underlining the tough environment for jobseekers.

More importantly, the survey found that China’s job market would not improve much in the third quarter as new graduates entering the job market will intensify competition for fewer jobs.

Among all the job categories, live streaming and entertainment has been the only outperformer so far this year, with the supply of related jobs more than doubling in the second quarter from a year earlier.

Jobs posted by foreign firms and joint ventures fell 36 per cent and 44 per cent respectively in the second quarter.

This article appeared in the South China Morning Post print edition as: One in five young graduates has no job

Post