China’s Youth Unemployment Hits Record 17.1% in July Amid Economic Challenges

Youth unemployment in China has soared to a record 17.1% in July, according to the National Bureau of Statistics (NBS). This marks the highest rate of joblessness among 16- to 24-year-olds this year, highlighting significant economic pressures facing the world’s second-largest economy.

The sharp rise from June’s 13.2% is attributed to various factors, including a saturated job market with nearly 12 million new graduates entering the workforce. The unemployment rate among this age group had peaked at 21.3% in June 2023 before authorities altered the methodology of reporting to exclude students.

Chinese Premier Li Qiang has called for greater support for businesses struggling under current economic conditions, urging that their difficulties be “truly addressed.” The government has been grappling with a heavily indebted property sector, rising trade tensions with Western countries, and a broader slowdown in economic activity.

In addition to the alarming youth unemployment figures, the broader unemployment rate for those aged 25-29 rose slightly to 6.5%, while the overall workforce unemployment rate remained at 5.2%. These figures primarily reflect urban areas, potentially underrepresenting the true extent of China’s employment challenges.

Economic indicators have been disappointing across various sectors. Industrial production growth weakened to 5.1% in July, down from 5.3% in June and missing analyst expectations. Real estate prices in major cities continued to decline, signaling weak demand. Furthermore, bank loan demand contracted for the first time in nearly two decades.

China is also facing international economic pressures, with the European Union and the United States implementing trade barriers to shield their markets from low-cost Chinese imports and perceived unfair trade practices. These external challenges, combined with domestic economic issues, have created a difficult landscape for China’s economic growth and employment prospects.