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Scholar Estimates China’s Unemployment Is as High as Twenty Percent

The new coronavirus has devastated the economies of countries around the world, leaving a large number of people unemployed, although the Chinese government has never publicly admitted the fact that the epidemic has eliminated the jobs of many Chinese people.

In a recent interview with Tencent Finance, a well-known Chinese economist Yao Yang, head of Peking University’s National School of Development, said that the epidemic has had a profound impact on the domestic economy. In the first quarter of this year, many small and medium-sized business, especially those in the service sector, were forced to close down. It is quite difficult for these low-profit businesses to reopen and some may disappear for good.

According to data that China’s National Bureau of Statistics of China released in July, in the first half of this year, more than 5 million new jobs were created in urban regions, exceeding the annual target. As of June, the nationwide urban survey showed an unemployment rate of 5.7 percent, but Yao mentioned another set of alarming numbers in the interview.

According to Yao, at the end of June, the National School of Development of Peking University conducted an online survey of more than 6,000 people. The survey showed that the unemployment rate was as high as 15 percent, and 5 percent were semi-unemployed. Considering over 700 million people in labor force, an unemployment rate of 20 percent translates into over a hundred million people unemployed at the time. Such a large unemployed population obviously differs significantly from what the government said at the time. It said, “The overall employment situation in the country is stable.”

He Qinglian, a Chinese economist currently living in the United States, believes that Yao’s remark gives a higher number than the official figure and that he wishes to emphasize the seriousness of China’s unemployment problem. “The problem of unemployment among the rural population is more pronounced. In the urban unemployed population, the people themselves generally absorb the unemployed. For example, it has almost become a common phenomenon that many unemployed young people have become their parents’ dependents.”

China unemployment rate is only based on the urban population. Critics believe that the authorities have long concealed the scale of hidden unemployment in rural areas on the grounds that farmers “have land to grow” and are not considered unemployed. In fact, due to the very limited arable land per capita in the country, there are a great number of surplus laborers in rural areas. These highly mobile populations are usually not included in government statistics.

He Qinglian said that the size of China’s rural unemployed population has always been a mystery and that this relates to their social attributes. “In the countryside, no matter how many unemployed people there are, they have no organizational and action capabilities. Mao Zedong once sent all the young intellectuals to the countryside to relieve the pressure in the cities.”

Yao also mentioned in an online forum in June that the unemployment problem of migrant workers, who travel to cities from rural areas to look for low paying jobs, is very serious. In the second quarter, migrant workers began to travel to the cities on a large scale, but due to limited job availability in the cities, there was another wave of them returning to the countryside in May. He also mentioned the 8.7 million new college graduates this year. The government plans to add 9 million urban jobs, which can at best match the demand of college graduates, but not the demand of those who have already lost their jobs.

Source: Radio Free Asia, December 18, 2020