Category News of China

Employers struggle to find talent

Shortfall in skilled workers may threaten future growth, McKinsey says

Wu Hao doesn’t think much of China’s young people. Even college graduates, the Hebei factory manager says, don’t have basic skills. “Smiling and shaking hands: I have to teach them this,” he complains. “I thought it was cute at first, but it’s really not funny.”

Mr. Wu is hardly alone in thinking it’s hard to find good help. In 2013, more than a third of employers in China surveyed said they struggled to recruit skilled workers. As China evolves from being the workshop of the world to, perhaps, being a services powerhouse, it will need more high-skilled workers. And it looks likely to run short.

According to new McKinsey research, in 2020, China will have about 24 million fewer high-skilled workers – those with university degrees or advanced vocational training – than it needs. If China does not bridge the gap, the costs, in the form of lower productivity and lost opportunities, could be more than $250 billion, which is about 2.3 percent of the country’s GDP.

Two mismatches are contributing to this problem.

One is geographic. Major cities like Beijing and Shanghai draw in ambitious young people from around the country and thus have more high-skilled labor than they can use; mid-sized and smaller cities don’t have nearly enough. This mismatch is particularly acute when one considers where future growth is likely to come as the character of China’s urbanization process changes. Specifically, in the next two decades, most growth will take place outside the top 40 cities.

The other is between what employers want from graduates and what they are getting. Surveys consistently show that employers are not satisfied with the skills of their new tertiary hires, whether academic or vocational. The main complaints, according to McKinsey research – and a wealth of anecdotal evidence – are: lack of technical training, inadequate English, and deficient soft skills, such as the ability to work in teams, independent thinking, and innovative flair.

Larger social trends are exacerbating matters. Over the past generation, the key to China’s remarkable productivity improvement has been the massive movement of people from country to city, from farms to factories. The apparently endless flow of new entrants to the labor force kept wages in check.

This strategy can no longer work. Official statistics show that the pace of migration is beginning to slow; at any rate, the generally low educational level of migrants means that they do not have the skills that companies need. Moreover, due to the one-child policy, the number of people in the workforce will fall in absolute terms, as it did in 2012, by 3.45 million.

In short, just when China needs many more skilled people, its population will be falling. China’s fewer workers will therefore need to be better ones, with skills suited to faster-growing sectors, such as high-end manufacturing, wholesale and retail trade, health, and education.

To bridge the skills gap, China has two advantages. One is that this is an area where industry and the private sector have every incentive to step up efforts. The other is that there are good examples of what works, from countries rich and poor, and in just about every industry. These solutions can be readily adapted and scaled up. Here are some ideas that work:

Engage youth early. Where the required skill is rare or new, don’t wait for the next generation to grow up and get interested: get to them while they are still in school. A number of industry-led programs, such as South Africa’s Go for Gold, expose youths to particular professions during secondary school, then assist them in training and further education. South Africa’s construction and engineering industry gets a pipeline of talent, and the young people, many of them from disadvantaged backgrounds, get a foothold in a fast-growing sector.

Run intensive boot camps. These are short programs that focus on delivering particular skills. One example is Dev Bootcamp, a United States-based for-profit computer-programming course that takes students of widely different ages and backgrounds; drills them intensively for nine weeks; and works with employers to understand exactly what they need. At the end of 2012, Dev Bootcamp said it had placed more than 90 percent of its graduates, at an average starting salary of $83,000. China is in a good position to develop boot camps because the for-profit education and training market is developing rapidly. Regardless of job or supplier, it’s imperative to involve employers, emphasize learning through practice and simulation, and assess proficiency to ensure that graduates are ready to work.

Create your own talent pipeline. Some of the most powerful solutions are those where leading employers come together to define the skills that they need and then work with local education providers to shape the curriculum. That is the story behind the Automotive Manufacturing Technical Education Collaborative, a joint program of 30 community colleges and major automakers that operate in the US to prepare students for careers in high-end auto-manufacturing skills. Collaboration can also be done on a for-profit basis. China Vocational Training Holdings is a private company that works with automakers to provide training to 100,000 students a year. It provides more than half of the industry’s new workers.

China can see the skills gap coming. If it fails to take the steps to close it, that would be a colossal mistake – on the order of $250 billion.

McDonald’s hopes to wow Chinese with rice

With an eye on dinner tables in the Chinese mainland, McDonald’s, the world’s leading fast food operator, on Wednesday announced new rice products for the mainland market.

Starting from June 10, the new products, including chicken and beef rice wraps, will be sold in all 1,700 McDonald’s restaurants on the Chinese mainland.

The core menu, including the chain’s staples like the Big Mac and McChicken, will not be changed, Kenneth Chan, chief executive officer of McDonald’s China, said in the press release.

“Our new dining options are examples of how McDonald’s innovates to bring more options to our Chinese customers, because that’s what they want,” Chan said.

The company’s strategy includes more efforts to develop the night consumption market from 5 p.m. to 5 a.m., thought it has put more emphasis on breakfast, lunch and afternoon snacks in the past, he said in an interview with Xinhua.

According to the latest data from McDonald’s, dinner foods account for half of foreign food operators’ sales in China and this market is growing at a double-digit pace.

Meanwhile, McDonald’s will set a series of standards regarding rice quality and safety, Chan told Xinhua. McDonald’s sources the rice it uses on the mainland from Harbin, capital of northeast China’s Heilongjiang Province, one of the country’s major grain production areas.

The company plans to maintain its competitiveness and boost its overall business growth by increasing the variety of the products it offers, he said.

McDonald’s opened its mainland first store in Shenzhen, Guangdong Province, in 1990. It has currently more than 1,700 outlets and over 90,000 employees on the Chinese mainland. It plans to recruit 75,000 more this year, and the number of mainland outlets is expected to reach 2,000 by 2014.

The U.S.-based fast food giant has about 34,000 stores worldwide. In 2012, McDonald’s same store sales rose 3.1 percent as revenues rose 2 percent to 27.57 billion U.S. dollars.

In 2013, the company plans to invest about 3.2 billion U.S. dollars of capital in opening 1,500 to 1,600 new restaurants and reinvesting in existing locations. It targets a system-wide sales increase of 3 percent to 5 percent and operating income growth of 6 percent to 7 percent.

China Faces Serious Brain Drain Crisis

China has the highest number of top talents moving overseas in the world, News.cn reports

According to the Office of Central Talent Work Coordination Group, about 87 percent of professionals regarded as top talents working in the science and engineering field have chosen to emigrate out of China.

A survey released by the Chinese Academy of Sciences shows that many innovative talents in the Chinese science & technology sector, especially in the fields of physics, mathematics and computer sciences, have served in high positions in the world organizations.

With the current fierce international competition for expertise from such personnel, many developed countries have been attracting talent by adjusting their immigration policies, and some developing countries have now also joined the global competition for talent.

Nearly one million Chinese overseas students returned to China through the “Recruitment Program of Global Experts” (1000 Talent Plan), including 20 thousand high-quality overseas professionals.

The report quotes a senior official with the Office of Central Talent Work Coordination Group as saying that China needs more flexible talent development policies and mechanisms to attract more talent coming back.

Beijing seeks govt executives on contract to boost growth

An annual salary of no less than 200,000 yuan ($32,640) will be offered to six new high-ranking government employees hired by Beijing on fixed-term contracts, announced the capital’s public service authority.

The six senior executive positions, which are highly prioritized to boost the capital’s growth, are with agencies including the municipal science and technology committee, the transport commission and the economic-technological development area.

However, those positions are not government jobs for life, often referred to as the “iron rice bowl,” as the two or three-year-long contract not only has a probation period varying from three to six months, but also can be terminated should the person fail a performance test.

All Chinese citizens under the age of 45, physically and psychologically healthy with relevant qualifications and skills, can apply for the positions, reads the recruitment announcement.

Qualified candidates must file their application before 6 pm on June 24. Candidates have to pass a tailored written test, an interview, a comprehensive review and a seven-day public review period before being recruited.

Long before Beijing, Shenzhen already started recruiting government employees with a contract in 2007.

More than 3,200 of some 40,000 government employees are working there on a contract basis.

Contract-based recruitment, which smashes the permanence and stability of the “iron rice bowl,” has also been expanded to cities and provinces including Shanghai.

Generally, a candidate has to pass a unified civil service exam and an interview before being hired by a State organ. In 2012, some 1.5 million candidates took the exam, with 75 competing for a position on average.

Mao Shoulong, a public administration professor at the Renmin University of China, said it is suitable to recruit intermediate and senior professionals through contracts, who may be unwilling to take the general exam and not work in one place for their whole life.

However, Mao said he sees no need to recruit all government employees on a contract basis, adding that neither of the systems is foolproof.

China Services Growth Slows Sharply, Adds To Recovery Risk

Growth in China’s services sector slowed sharply in April to its lowest point since August 2011, a private sector survey showed on Monday – fresh evidence of rising risks to a revival in the world’s No.2 economy.

The HSBC services Purchasing Managers’ Index (PMI) fell to 51.1 in April from 54.3 in March, with new order expansion the slowest in 20 months and staffing levels in the service sector decreasing for the first time since January 2009.

Two separate PMIs last week had already shown that China’s manufacturing sector growth slowed, With the weakness spreading to services, which make up almost half of gross domestic product, the risk to the recovery may be increasing.

“The weak HSBC service PMI figure provides further evidence of a slowdown not only in the factory sector but also in the service sector,” said Zhang Zhiwei, chief China economist at Nomura Securities in Hong Kong.

“This confirms our worries about insufficient growth momentum in the economy, which we expect to slow to 7.5 percent in the second quarter.”

The HSBC services PMI follows a similar survey by China’s National Bureau of Statistics, which found non-manufacturing activity eased to 54.5 from 55.6. The official PMI is more weighted towards large state-owned firms.

Readings above 50 indicate activity in the sector is growing, while those below 50 indicate it is contracting.

The HSBC survey showed that the sub-index measuring new business orders dropped sharply to a 20-month low of 51.5 in April, with only 15 percent of survey respondents reporting an increased volume of new orders that month, HSBC said.

“This started to bite employment growth. All these are likely to add some risk to China’s growth in 2Q, as there’s still a bumpy road towards sustaining growth recovery,” said HSBC’s China chief economist Qu Hongbin.

The employment sub-index decreased to 49.6 in April, the first net reduction in staff numbers since January 2009, although HSBC said job losses were marginal, partially caused by firms down-sizing and employee resignations.

Employment is a decisive factor shaping government thinking because it is crucial for social stability. The services sector accounted for 46 percent of China’s gross domestic product in 2012, as big as the country’s better-known manufacturing industry.

China’s economic growth unexpectedly stumbled in the first quarter, slipping to 7.7 percent versus 7.9 percent in the previous three month period, as factory output and investment slowed.

The government has set a 2013 growth target of 7.5 percent, a level Beijing deems sufficient for job creation while providing some room to reform to the economy.

Any more weak data could spark a policy response.

“The risk of slower growth is rising, the Chinese government will probably take actions after April data come out,” said Jianguang Shen, chief China economist of Mizuho Securities Asia in Hong Kong.

“I see an increasing possibility for China to cut interest rates, but not likely any time in the near future, as housing inflation is a constraint.”

However a Reuters poll last month found that China’s central bank is expected to keep the benchmark one-year bank lending rate at 6 percent and the one-year bank deposit rate at 3 percent through 2013, as well as holding banks’ reserve requirement ratios (RRR) steady.

China’s graduates enter tight job market

BEIJING (AP) — Chemistry student Jiang Wenying graduated three years ago and decided the job market was so tough she might as well go back to school for a graduate degree. Now she’s finding it even worse, in what looks to be China’s tightest market ever for job-seeking graduates.

Jiang says she has sent out more than 1,000 job applications, netting no more than 10 interviews and not a single job offer.

Jiang, who received her graduate degree in chemical industry from the Harbin University of Science and Technology this year, recently traveled to Beijing to try her luck at a university campus job fair, but found no firm prospects there either.

“The job market has been getting worse by the year,” said the young woman, who looked dejected as she slouched against a column at the end of the job fair. She spoke just loud enough to be audible above the din of workers dismantling booths.

“There are far more chemical industry students than needed,” she said.

While the job market in China is still much better than in many other parts of the world, 2013 is being billed locally as the worst for young graduates. A record number of them — about 7 million — are leaving universities and graduate schools to seek their first employment at a time when companies are hiring fewer people. Women appear to be faring worse than men.

The stunning economic growth of the past dozen years is slowing, and gone are the days when graduates were assigned jobs in their respective industries — a system dismantled in the 1990s in China’s fast-changing economy.

The issue is politically sensitive because China’s urban, educated class has become outspoken about government shortcomings in dealing with ills ranging from endemic corruption to polluted air, and the tight job market could leave many among them disgruntled after more than a decade of economic expansion and rising expectations.

This year’s biggest-ever graduating class is the fruit of many years of government policy to boost enrollment, but the number of jobs for new hires has declined about 15 percent compared with the previous year, said Yang Xiong, director of the Youth Research Center in Shanghai Academy of Social Sciences.

“With those two factors, you end up with the toughest job market this year,” Yang said. “The global economy is not faring well, and China is part of the globalization. With closure of many export-oriented businesses and appreciation of the Chinese currency, employers have to slash on personnel.”

Preliminary data reported in state media show about a third of the 2013 class had signed employment contracts by May, compared to more than 40 percent a year ago. The number of students applying for graduate schools has reached a new high of 1.76 million.

The notion that education provides the promise of success has ancient, Confucian roots in China. It continues today, perhaps even more so because of family planning policies that often put the burden of a family’s future on a single child.

The country’s policy-makers — aware that a lack of jobs for the young and educated could be seen as a failure to uphold the social contract — have been urging that every measure be taken to help newly minted graduates gain employment, including creating more community-level jobs, reducing paperwork, recruiting for the military and promoting entrepreneurship.

“The employment of the graduating class affects economic development, improvement to living standards, and social stability,” said a central government document issued in mid-May when the issue was on the agenda of a state council meeting presided by Premier Li Keqiang.

Education Ministry spokeswoman Xu Mei told state media that the ministry and local education bureaus would offer more job fairs and online job-seeking services. “All sides are making efforts to ensure the employment rate of this year’s class won’t get lower,” she said. AP’s request for an interview with a ministry official on the issue was not immediately answered.

Some job seekers are lowering their expectations. Wang Yuan, an industrial design major at southern China’s Hunan Industrial University, thought a design job would be waiting for her after graduation. But nothing has become of the two dozen job applications she has sent out since last fall.

“They were like stones sinking into the sea,” said Wang, 23.

She has since changed her tack. “Any job will do, and choosiness will have to come later,” she said.

Lynn Lee, a 21-year-old law undergraduate student at Huaiyin Normal College in Jiangsu province, tried to find work in legal affairs, media, sales and executive assistance before finally landing a job as a bank teller near her hometown. Her job search included nearly 100 applications and several out-of-town trips.

“There were rounds of interviews, and many candidates had impressive academic credentials,” she said. “I was so nervous I couldn’t sleep at night, and now I’m left with a migraine.”

Lu Feng, an electronics senior at Xidian University in central Chinese city of Xi’an, said he was shocked to see a room filled with more than 1,000 applicants when he showed up for an interview with a technology firm from southern China recruiting for 20 jobs in his city. He got hired, and the job hunt took him only a couple of weeks.

Lu and several other male job seekers interviewed by The Associated Press said they feel they have better job prospects than females, and can even afford to be choosy.

China’s job market is notoriously discriminating. Employers have openly snubbed women, out-of-town job applicants and graduates from less prestigious institutions. This year, the Chinese State Council has demanded that employers make no requirement on gender, ethnicity, age, residence and type of school when hiring graduates of higher education, but the directive is unlikely to be followed.

When compared with elsewhere, China’s economy is still doing relatively well, with an overall urban unemployment rate of only 4.1 percent in 2012. That compared with unemployment rates ranging from 4.7 percent to more than 27 percent in European countries; the U.S. rate was 7.5 percent last month. However, a large share of China’s population is in the countryside, and urban data only cover a portion of China’s workforce.

Luo Xiaoming, editor-in-chief of the Chinese-language financial news site Caixun.com, said China’s economic growth of 7.7 percent for the first quarter should be able to absorb the increase in job seekers, but the challenge in the job market reflects a flaw in China’s investment-driven economy, which is expanding without job growth.

“This economic model has misled the market, resulting in excessive production capacity, and its lack of openness to the private sector has stifled innovation and entrepreneurship,” Luo said in explaining the lack of jobs in China. “Economic transformation has been stagnant.”

Some lay the blame on China’s education system, which they say is a mismatch to China’s job market.

Many jobs require only a polytechnical education, and perhaps China is currently producing too many university graduates, including doctoral-level students, said Yang, the youth research center director. That means many graduates end up with lower-level jobs that have little to do with their areas of study.

“Why would they want to take basic jobs? If they don’t, they become unemployed,” Yang said.

New Contracts for Civil Servants to go National

This is an extended abstract of an article that appeared in this week’s edition of The Economic Observer, for more highlights from the EO print edition, click here.

By the end of 2013, numerous provinces and cities across China will have launched pilot programs implementing fixed-term contracts in the hiring of civil servants. By the end of 2014, the contract system may be implemented nationwide.

Shenzhen was the first city to launch the contract system, doing so in 2007. Shenzhen was followed by Shanghai in 2008, and Jiangxi, Henan, Fujian, Liaoning, and Guangxi provinces in 2012. Jiangsu, Sichuan, Shanxi and Shandong provinces are expected to launch contract systems by the end of 2013.

When Shenzhen initially implemented the contract system it hired 41 civil servants. Now, Shenzhen hires all new civil servants through the contract system. Currently there are 3,000 civil servants under the contract system in Shenzhen, with another 500 to be added later this year.

The new contract system allows for more flexibility in the process of hiring officials. Applicants can be recruited directly and might be able to avoid the extended series of exams and interviews that others hoping to land a public service job are forced to go through.

The new system also differs from existing hiring practices in relation to how the salary package for such civil servants are determined. Traditionally, renumeration for most civil service positions are centrally determined according to their level. Under these new fixed-term contracts, employees enter into a wage agreement with the department hiring them and thus have more room to negotiate. The final salary of public servants that have been recruited according to the new contract system are determined by the contract they sign with the department.

Zhu Lijia (???), a professor at the Public Management Teaching and Research Department and director of the Public Administration Department at the China National School of Administration, says that the lack of regulations covering the direct recruitment of civil servants and the process of negotiating a salary package means that the system is open to abuse.

The new contract system is mainly used for recruiting highly-skilled professionals.

Liang Yuping (???), director of the Civil Servant Management Department at the Chinese Academy of Personnel Science, and Peng Jianfeng (???), a professor at the School of Labor and Personnel at Renmin University of China, believe that the contract system helps to both motivate and supervise civil servants.

However, Li Jianzhong (???), a researcher at the Chinese Academy of Personnel Science, told the EO that preventing people becoming civil servants through direct recruitment and preventing local governments from providing unreasonably high wages to civil servants, is the best way to guard against corruption.

Last year over 1.5 million people registered to take the national civil service exam. They were competing for approximately 20,800 positions.

Liu Xin, a professor at the Institute of Organization and Human Resources at Renmin University, recently explained to Time Magazine why so many Chinese graduates are attracted to a career in the country’s civil service. “As a civil servant in China, unless you quit or make a big mistake, you have a job for life,” he said. “It’s the iron rice bowl. That’s especially important during an economic downturn.”

The roll out of these new fixed-term contracts along with mounting job pressures, may begin to alter this perception.

Large tungsten mine discovered in E China

Geologists have discovered a large tungsten mine in east China’s Jiangxi Province, officials said Thursday.

More than 1 million tonnes of tungsten and associated copper have been found at the mine in the Zhuxi mineral area of Fuliang County in the northeast part of the province, said Peng Zezhou, chief of the provincial geology and mineral resources exploration bureau.

The Ministry of Land and Resources confirmed the discovery on Wednesday on its website.

A maximum depth of 449 meters of tungsten and 30 meters of associated copper in the mine has been penetrated, said Peng.
The reserve explored is in the same province as the world’s largest tungsten mine, which was found in Wuning County, Jiujiang City, Jiangxi. It holds tungsten reserves totalling 1.06 million tonnes.

Geologists said they expect to find more tungsten at the newly-discovered mine, which could oust the mine in Wuning County as the world’s largest.

Alarming drop in Chinese graduates landing jobs

Yang Biao has spent every weekend for the past two months at job fairs. The 25-year-old, who will finish a Chinese literature degree at Beijing University of Technology in July, has also sent out nearly 200 job applications.

“I do feel like I’m running out of time and I’m getting more anxious as each day passes,” he said. “But I can only cross my fingers and hope I will no longer need to live off my parents.”

Yang is one of a record nearly seven million students who will graduate from mainland universities this year and enter the job market during a marked economic slowdown.

By early this month, 52.4 per cent of mainland students about to graduate had signed job contracts, down seven percentage points on the same time last year. In the industrial hub of Guangdong, the rate was 46 per cent, and in Beijing, home to such top universities as Peking and Tsinghua, it was just 33.6 per cent.

Graduates majoring in English, law, computer science and technology, accounting, international trade and industrial and commercial administration are finding it harder to find jobs.

President Xi Jinping made a high-profile visit to a job fair in Tianjin on May 14 to reassure jobseekers, pledging to create more jobs by boosting economic growth. Xi told the graduates he met that having a job was the foundation of people’s livelihood and that employment struggles were becoming a global problem, Xinhua said. He was quoted as saying that only economic development could help improve the situation.

A day later, Premier Li Keqiang chaired a State Council meeting that outlined several measures designed to keep the employment rate for graduates no lower than last year.

The State Council also promised to tackle discrimination and inequality in the job market and to provide jobseekers from poor families with one-off allowances to help them find jobs.

Yang, from a rural family, said more than half his classmates were still looking for a job by the middle of this month. Because he was about to graduate from a less prestigious university, he did not expect a well-paid job, just one that could support him.

He said he had turned down a job offer from a Beijing kindergarten with a base salary of 1,700 yuan (HK$2,130) a month because it was not enough to make ends meet, given that he would have to move out of his parents’ home on Beijing’s outskirts to work in the city centre. Yang tried to get into a postgraduate school to further his studies and boost his competitive edge, but failed the entrance exam in February.

Another jobseeker, Ji Yinrui , said the cost of pre-employment accreditation courses in the computer and IT sector was a bigger problem for him than the tight job market. Ji, who will graduate from a university in Tianjin with a degree in computer science and technology, said many big-name employers in the computer and information technology sector required newly graduated jobseekers to take accreditation courses from privately run career training institutions as a condition for recruitment.

But such courses, which lasted up to six months and cost between 10,000 yuan and 20,000 yuan, were beyond the reach of jobseekers like him from poor rural families.

“I understand the employers’ concerns about a general lack of workplace skills among graduates nowadays, but isn’t that an issue about how we’ve been taught in universities?” he said. “Because what we’re required to learn at the private training schools is exactly what we should have been taught at university, especially during our last semester.”

Ji’s hunt began in November and he has given himself another two months to land a job, even a part-time one, because he says it is time to stop relying on his parents and stand on his own feet.

Citing a survey by the National University Student Information and Career Centre, China Central Television reported on May 19 that demand for recruits by employers with more than 1,000 employees was down by 3.6 per cent compared with last year.

A university degree no longer guarantees a decent job on the mainland because a reckless, government-led push for expansion since the late 1990s has seen the number graduating each year more than triple in the past decade.

The prospects of landing highly sought-after positions at government agencies and state-owned enterprises are often linked to power and money.

Some 500 college graduates in Shanxi lost tens of millions of yuan between 2008 and last year to a rogue job agency in a scam in which they were each swindled out of between 200,000 yuan and 500,000 yuan paid in return for promises of jobs in the state-owned sector.

As competition in the job market gets fiercer, those from less privileged families also face all sorts of discrimination and administrative barriers.

Zhao Lili , a postgraduate student in Beijing originally from Henan , said she faced twin difficulties in job hunting – as a woman and someone without Beijing household registration, or hukou.

“Many recruiters have shown no interest in me after learning that I’m not a local resident because they think I’m more of a liability than a local applicant,” she said.

Zhao, who is studying business management, said a far larger proportion of male students in her faculty had found jobs than had female students.

Xiong Bingqi , deputy director of the Beijing-based 21st Century Education Research Institute, said governments needed to play a bigger role in creating jobs, boosting transparency in recruitment and addressing inequality in access to sought-after positions.

Xiong also warned against a public preoccupation with statistics about the job outlook for university graduates, which could put pressure on universities to doctor their employment figures and force students to rush into jobs they disliked.

Studies by Mycos Data, a mainland consultancy specialising in higher education, show that 38 per cent of university graduates in 2009 left their jobs after six months.

“So job-creation efforts for college graduates are not a seasonal issue, but should begin shortly after students enter universities and continue all the way through the first three or five years of their career and even longer,” Xiong said.

44% of university seniors secure jobs

More than 44 percent of university seniors in the city have secured jobs after graduation as of Friday, down 2 percentage points from the same period in 2012, the Shanghai Evening Post reported Monday.

The closely watched statistic, which local universities track annually, shows the proportion of graduating seniors who have signed employment agreements so far this year. The number has received a lot of attention recently from local media outlets, many of which have proclaimed 2013 as the toughest year in recent memory for graduating seniors seeking their first job.

The Shanghai Municipal Education Commission disputes that assessment. The commission called a press conference Monday to assert that the figure is in line with past years.

The situation is no worse than it was from 2009 to 2011, said Li Ruiyang, the commission’s deputy director.

The gap between this year’s and last year’s figures gradually closed over the course of April, which is the month when many seniors begin signing employment agreements, Li said.

As of April 10, the agreement signing rate was 4.07 percentage points lower than the previous year, according to the commission. By April 25, the gap had shrunk to 3.17 percentage points.

There are 152,000 positions available for the city’s 178,000 graduating seniors this year, though the commission predicts that about 48,000 graduates will choose to continue their education rather than enter the labor market.

Although there appears to be enough open positions for the graduates, it does not mean every student will easily find a job, said Chen Dongyuan, an official from the division of employment at the Shanghai Municipal Human Resources and Social Security Bureau.

The proportion of students who sign an employment agreement ultimately hinges on whether graduating seniors can meet employer requirements, and vice versa, Chen said.

Many students have not been satisfied with the salaries they have been offered, while many companies have found the experience of many graduates lacking, a commission official said. The mutual dissatisfaction has also contributed to the lower agreement rate.

“One reason why the signing rate is still below 50 percent is because some students are holding out for better offers,” Chen told the Global Times. “The rate will probably rise over the next month.”

Chen said the slowdown in economic growth has also caused a drop in the number of open positions as many companies have no plans to recruit new employees.

By comparison, the signing rate for vocational students has exceeded last year’s by 1.2 percentage points. Some vocational school students have acquired an edge over university students because of the practical skills they have learned, the official said.