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Chinese Scholar: Possible Underestimate of Youth Unemployment Rate

According to Zhang Dandan, a professor from Beijing University, the youth unemployment rate in China may be underestimated due to discouraged workers temporarily leaving the labor force during weak job markets,

According to an article published by Zhang in China Digital Times, structural and short-term factors both contribute to high youth unemployment. In the long run, three years of COVID-19 restrictions significantly impacted consumption, business, and economic vitality. In the short run, the 16.6% year-on-year increase in college graduates in 2022 and the 12% increase in graduate students flooded the job market. Rapid AI development has also begun replacing human roles in some white-collar professions like finance and sales, disproportionately impacting highly-educated youth. While vocational youth employment has rebounded slightly since March, unemployment remains high for 4-year college graduates. The number of civil service exam takers surged 80% during the period 2022-2023, reflecting graduates’ job insecurity. With 11.58 million total 2023 graduates, competition is fierce.

According to China’s Bureau of Statistics, urban youth in the 16-to-24-year old age range comprise 96 million individuals, of whom 64 million do not have jobs. Among this group of non-laboring urban youth, 16 million are non-students, many of whom choose to “lie flat” by relying on their parents rather than working. If these individuals were counted as unemployed, the youth unemployment rate could be as high as 46.5% rather than the reported 19.7%.

College graduates are increasingly choosing to not work immediately after graduation, comprising about 75% of the youth who choose to “lie flat. This situation may be helped as college graduates reduce their salary expectations and gradually enter the workforce. However, economic recovery is needed to fundamentally address the root cause of youth unemployment.

Source: China Digital Times, July 19, 2023
https://chinadigitaltimes.net/chinese/698406.html

Briefings | | |   Economy/Resources

Xi’an’s “Exam Migration” Controversy Tests Limits of Hukou Reforms

An imbalance in educational resources in the Chinese city of Xi’an sparked intense debate last week. Parents sought answers from the local education authorities, asking why so many students from other provinces took the high school entrance exam (zhongkao) in the city this year.

After the Xi’an government released the results of the zhongkao (senior high school entrance examination) results on July 14th, rumors circulated that 40,000 of the 100,000 exam takers were “returning students” – students who came to Xi’an just to take the exam, hoping to later take the Xi’an gaokao (college entrance exam) because Xi’an has a lower college admission cutoff than other areas. This would potentially enable test takers to get into better universities.

Experts believe that the trend of allowing outsiders to take exams locally is “irreversible” in most cities, saying that authorities should be rational about zhongkao and gaokao migration and be more transparent about “returning student” data.

Xi’an officials responded last week, claiming only 3,608 “returning students,” or 3.5% of exam takers, took the zhongkao in Xi’an. The parents of local students, who were not convinced by the official data, protested against unfair use of local resources by outsiders. After widespread pushback from parents, Xi’an authorities launched an investigation. By Monday, police had detained 40 people for providing false registration information to ineligible students.

The “returning students” benefited from Xi’an’s 2017 household registration (hukou) reforms, which allowed non-local children of Xi’an hukou holders working elsewhere to take exams in Xi’an. The reforms also granted Xi’an hukou to outsider talent, making their children eligible to take Xi’an school tests as “returning students.”

Experts say the core issue at play is unequal distribution of educational resources nationwide, with college admission cutoff lines being different from one province to another. This gives rise to the phenomenon of “zhongkao migration.”

Authorities have vowed to verify each “returning student’s” eligibility and cancel admissions obtained fraudulently. By Monday, police had cracked down on institutions providing false services to ineligible students.

Source: BBC, July 24, 2023
https://www.bbc.com/zhongwen/simp/chinese-news-66291281

Briefings | | |   Social Stability

Xi Jinping Calls for Strengthened Farmland Protection

Chinese President Xi Jinping recently stressed the importance of food security, calling for enhanced protection of China’s farmland, improved quality of the farmland, and full utilization of the potential of saline-alkali land to boost agricultural production.

On July 20, Xi chaired a meeting of the Chinese Communist Party’s (CCP) Central Financial and Economic Committee to study the issues of strengthening farmland protection and comprehensive improvement of saline-alkali land. The meeting notes say that China’s situation, with a large population and a small amount of land, has not changed, and that the country still faces prominent problems around use of farmland for non-agricultural purposes. The meeting stressed the need to “ensure that the red line of 1.8 billion mu (120 million hectacres) of farmland will never be broken.”

The meeting stated that the central government should motivate farmers and local governments to protect farmland and promote grain production, establish a mechanism to guarantee the income of grain farmers, and develop various forms of moderate-scale agricultural operations.

The meeting pointed out that the comprehensive improvement and utilization of saline-alkali land is an important aspect of farmland protection and improvement. China has a large amount of saline-alkali land, and the trend of saline-alkaliization of farmland in some areas is becoming more serious. The meeting notes said that it is of great significance that China launch a project of comprehensive improvement and utilization of saline-alkali land, fully tapping the potential of saline-alkali land, strengthening the improvement of existing saline-alkali farmland, and effectively curbing the trend of saline-alkaliization of farmland.

Source: Central News Agency (Taiwan), July 20, 2023
https://www.cna.com.tw/news/acn/202307200385.aspx

Briefings | | |   Economy/Resources

Beijing Commends Covert Front, Emphasizes National Security in Rare Conference

China held a rare nationwide commendation conference in Beijing to recognize the achievements of its national security system in safeguarding sovereignty and security. Chen Wenqing, Secretary of the Central Political and Legal Affairs Commission of the Chinese Communist Party, stressed the importance of the CCP’s “covert front” work in achieving these goals.

The conference highlighted the “covert front’s” involvement in significant events, including the 1997 Hong Kong sovereignty transfer, the 2008 Beijing Olympics, the 2019 Hong Kong anti-extradition law protests, the 2021 “Operation Fox Hunt,” and the arrest of the founder of the Taiwanese National Party, Yang Chih-yuan.

The conference event took place on the 40th anniversary of the Ministry of State Security’s establishment. The last such national conference commending the national security system took place in 2015. According to a U.S. Department of Justice document, China’s Ministry of Cstate Security functions as the country’s intelligence, security, and secret police agency, akin a combination of U.S’s CIA and FBI.

During the conference, Chen Wenqing emphasized the need to modernize the national security system and confront the increasingly complex security challenges facing China. He called for the implementation of President Xi Jinping’s rule of law and overall national security principles to protect the country’s sovereignty and security.

Recent reports suggest that new arrangements have been made regarding the “covert front” work. On July 1, a revised version of China’s Anti-Espionage law came into effect, marking the first specialized legislation pertaining national security since the 20th National Congress. This indicates that China’s commitment to strengthening its national security apparatus and addressing evolving security concerns is a top priority for the CCP.

Source: Central News Agency (Taiwan), July 17, 2023

https://www.cna.com.tw/news/acn/202307170205.aspx

Briefings | | |   Government/Politics

China’s Housing Market Continues Decline, Early Mortgage Repayment on the Rise

The Chinese real estate market, particularly the second-hand housing market, is experiencing a downward trend. The city of Shanghai is leading the decline in prices.

Out of 70 major cities surveyed, 63 saw a decrease in second-hand housing prices in June. New home prices in 31 cities increased slightly compared to the previous month, but the overall downward trend is evident when considering both new and second-hand homes in key cities like Beijing, Shanghai, Guangzhou, and Shenzhen.

A report by Chinese media outlet “The Paper” reveals that less than 30% of Cina’s top 100 real estate companies achieved year-on-year growth in monthly performance this June. Nearly 60% of the top 100 companies experienced a monthly performance decline exceeding 30%, indicating a challenging market situation. The construction industry is also affected, with a significant decrease in new housing construction area and real estate development investment.

The market experienced a rebound in March and April due to pent-up housing demand from the pandemic, but it cooled off quickly afterwards. Real estate companies usually increase supply in June to boost sales, but this year the supply was at a five-year low. The concept of “early repayment” has been gaining traction in the market, with individuals choosing to repay their housing loans early due to higher mortgage rates on existing loans from previous years as well as declining investment returns from financial products. Both the early loan repayment trend and falling housing prices indicate clear downward pressure on the Chinese real estate market.

Source: Deutsche Welle, July 15, 2023
https://p.dw.com/p/4Twun

Briefings | | |   Economy/Resources

Civil Servants in Guangdong Face 25% Pay Cut

In recent days there have been widespread reports on Chinese social media that the Guangdong provincial government has announced a 25% pay cut for civil servants, sparking online debate. Although officials have not publicly responded to the reports, sources in Guangdong and other provinces have revealed that civil servant pay cuts across China are now an undisputed fact. Many netizens have commented on the above reports, urging the government to clarify whether the 25% cut is real, but officials have remained silent.

Analysts attribute these pay cuts to the collapse of local government income, which depends on revenue land sales. Government land sales have plummeted in the current recessionary environment, even falling as low as zero in some areas.

According to unconfirmed reports, the Guangdong provincial government recently held a press conference announcing the decision regarding pay cuts, confirming earlier speculation. Prior to this, several other provinces had already lowered civil service wages, including a 25% reduction in Zhejiang, 15% in Jiangsu, and 20% in Fujian. With the Guangdong news, broader civil service pay cuts seem imminent.

During more prosperous years, civil servants in economically vibrant regions enjoyed higher salaries. Some areas in Shandong have gone months without disbursing wages.

Source: Radio Free Asia, July 11, 2023
https://www.rfa.org/mandarin/yataibaodao/jingmao/gt2-07112023083235.html

Briefings | | |   Economy/Resources

China Put University Faculty Under Tight Scrutiny

The Chinese Ministry of Education has launched a campaign to enforce ideological conformity among university teachers. Ever since Xi Jinping took office, education has been focused on cultivating talent supportive of socialism, and universities are now required to offer courses on ideological and political theory, including “Xi Jinping Thought.” The ministry’s recent notice calls for a “self-examination and self-correction” campaign, targeting teachers of these courses to investigate their past academic experiences for any “inappropriate remarks or behaviors.” However, teachers have found templates on Chinese websites to help them complete their self-examination reports.

This campaign has prompted major universities across China to initiate a concentrated learning and education movement to evaluate teachers’ professional ethics. Specifically, teachers of ideological and political theory courses are being scrutinized for their past beliefs, political discipline, academic integrity, and ideological morality. Those deemed to have “crossed the bottom line” in these aspects face removal from their teaching positions through job transfers, dismissals, or resignations. Universities are expected to complete preliminary investigations by mid-July and propose plans to address problematic teachers.

Since Xi Jinping’s call for the “Seven Don’t Mentions” at universities, an increasing number of Chinese professors have faced consequences for discussing topics like universal values, press freedom, and civil society in their classrooms. Several professors from prominent institutions have been affected, leading to a culture of suppressing dissent. Apart from dismissals, outspoken and progressive teachers also face various other forms of retaliation. For instance, Guo Yuhua, a professor at Tsinghua University known for her work on China’s underprivileged communities, was detained by customs officials when she tried to travel to Hong Kong. Guo Yuhua had criticized and exposed policies related to rural areas and grassroots governance in China and publicly withdrew from the Communist Party in 2014.

Source: Radio Free Asia, July 7, 2023
https://www.rfa.org/cantonese/news/teacher-07072023015818.html

Briefings | | |   Government/Politics

Chinese Police Forced German-Chinese to Provide Information on Overseas Protesters

A recent investigation by German news outlet Correctiv has uncovered the case of a young German-Chinese man who was pressured by Chinese authorities to provide information about Chinese-Germans critical of the Chinese government. The man, identified as Alex, was interrogated by police upon his arrival in China and was shown photos of himself participating in anti-government protests in Germany. After hours of questioning, Alex provided fake names of two protesters he knew. Correctiv has verified his account through conversations and evidence such as photos and chat records.

German security agencies are currently investigating the incident. If confirmed, this incident will further strain the already tense relations between Germany and China. Ulrich Lechte, a spokesperson for the Free Democratic Party parliamentary group, and Jürgen Hardt, the deputy chairman of the parliamentary foreign affairs committee, have called on the German Foreign Ministry to issue travel warnings for China in response to this incident.

The German Foreign Ministry has stated that German citizens of Chinese descent have consular protection rights, and they are unaware of any Chinese refusal to recognize the German citizenship of ethnic Chinese Germans. The ministry acknowledged previous cases where China did not fully comply with its international obligations when dealing with ethnic Chinese who obtained foreign citizenship.

This incident adds to the list of instances where Chinese authorities have pressured Chinese citizens or ethnic Chinese living abroad. In a previous investigation, it was revealed that the Chinese government exerts strict control over Chinese students studying in Germany, particularly those receiving scholarships from the China Scholarship Council. These students are required to sign agreements promising not to engage in activities detrimental to China’s interests and regularly report to the Chinese embassy. Several Chinese students expressed fears of government surveillance and harsh reactions from the Chinese consulate if they participated in protests in Germany.

The German Foreign Ministry has not indicated whether travel warnings for China will be updated in light of this incident.

Source: Deutsche Welle, July 8, 2023
https://p.dw.com/p/4TcNi

Briefings | | |   Geo-Strategic Trend