Chinese grads: Supply of college graduates in China far exceeds demand. Blue-collar workers are much less plentiful. A decade-long expansion in university capacity has created distortions in the job market. China needs to work on the imbalances.
The number of people graduating from college has tripled in the past eight years to 6.6 million in 2011, according to the ministry of education. But, demand for graduates has not kept pace. The starting monthly salary of college graduates is 2,703 yuan ($422), little changed from 2008’s average of 2,691 yuan, according to recruitment site Zhaopin.com.
Unemployment among college graduates is high. In Beijing, only 50 per cent of the class of 2011 found jobs before leaving full-time education, according to the capital’s education bureau. Blue-collar workers, however, are in shorter supply. Their average monthly salary has almost doubled to $264 since 2005, according to China’s ministry of human resources and social security.
China has focused on quantity, not quality, in higher education. Expanding college capacity was seen as a way to absorb excess labour and boost consumption after massive layoffs at state-owned enterprises in the late 1990s. Expenditure on tertiary education has been growing along with GDP, but student numbers have been rising at about 20 per cent a year. Expenditure per student has fallen steadily.
China is good at building new campuses, but slow in adjusting its curriculum to suit modern needs. Take engineering. Though China has more engineering graduates than any other country, McKinsey reckons China’s pool of young engineers suitable for multinationals is no larger than UK’s. The education is biased towards theory and Chinese students get too little experience in projects or teamwork.
Beijing is right to invest in human capital. But, it needs to invest more to raise the quality of its graduates. It should increase funding for its universities, and bring curricula more in line with the needs of industry. Tighter focus on higher quality tertiary education may also increase the pool of added-talent labour available for high-end blue-collar work.
