China’s Economic Crisis Worsens as Youth Unemployment Peaks

China’s young people are facing a major joblessness crisis as youth unemployment rose to 17.1% last month, with critics claiming that the numbers are actually far worse than reported.

The Chinese National Bureau recently released a report suggesting that youth unemployment, which stood at 13.2% in June, increased to 17.1% in July, the highest number recorded this year.

However, independent observers noted that the country notoriously known for state censorship is intentionally downplaying the data just like it did in June 2023, when youth unemployment rose to 21.3%, and urged the authorities to stop releasing the data completely.

After mounting criticism, the government once again started publishing employment data but completely changed its reporting mechanism so that the numbers do not represent the condition of the country’s deteriorating economy.

For instance, the latest reports do not include youth in rural areas, which are suffering from far worse employment situations. Similarly, the government does not include students in its job reports, many of whom start pursuing higher education after failing to land a job.

The joblessness crisis has impacted young people between the ages of 16 and 24 the most, as most roles are filled by older employees with more experience. The overall unemployment rate in China stands at 5.2%.

This rising unemployment majorly stems from the general manufacturing crisis that has grappled China in recent years. Declining industrial production has taken a severe toll on the Chinese economy, as the country’s exports reduced by 4.6% in 2023 compared to 2022. China’s exports also fell by $7 billion in July 2024 compared to June, which is a worrisome economic indicator for a country that drives much of its profits by exporting cheap products in global markets.

The situation is equally bad in the Chinese real estate sector, which is continuously going downhill despite recent government measures that have desperately tried to save the nosediving property sector. This persistent weak economic data coming out of China has also lowered global oil prices, as demand remains even lower than in the pre-COVID era.

Amid the rising manufacturing crisis, the service sector is emerging as a silver lining, as the job situation in this sector is still much better than in the manufacturing industries.

The unhealthy job statistics are also testing the limits of the Chinese Communist Party, whose top professionals like Prime Minister Li Qang keep on claiming that young people are extremely important to keep the country’s economy afloat.