Drop in youth unemployment rate seen as graduates prepare for labor market

China's jobless rate for its youngest workers fell to 15.6 percent in May, the lowest level in 11 months, official data showed on Monday, ahead of a record wave of college graduates entering the job market.

The unemployment rate for the 16-to-24 age group, excluding students, dropped 0.7 percentage points from 16.3 percent in April, according to the National Bureau of Statistics.

The rate had peaked at 18.9 percent in August — the highest since China revised its survey methodology in December 2023 — before declining steadily between September and February.

It ticked up again in March before resuming its downward trajectory in April and May.

The improvement was broad-based across age groups. The unemployment rate for the 25-to-29 age group cohort fell to 7.2 percent in May from 7.4 percent in April, the lowest in three months, while the rate for the 30-to-59 age group edged down to 4.1 percent from 4.2 percent, a four-month low.

The overall urban survey unemployment rate stood at 5.1 percent, down 0.1 percentage point from April.

Li Chang'an, a professor at the University of International Business and Economics' Academy of China Open Economy Studies, attributed the improvement to stable macroeconomic fundamentals and the continued strengthening of pro-employment policies, particularly those targeting young people.

"The employment first policy, I should say, has played a very positive role," he said.

China has made job creation a top priority. Earlier this month, the State Council, China's Cabinet, unveiled a plan to place an "employment first" strategy into action over the 15th Five-Year Plan (2026-30) period. The blueprint seeks to stabilize overall employment while better aligning what students learn in school with what employers actually need.

For young people — especially the record number of college graduates this year — the plan aims to broaden job and career pathways. Steps include building a national big data platform to match talent with job openings, and revamping university curricula to better serve emerging industries.

Other programs feature skills training for 1 million young workers in advanced manufacturing and modern services, as well as a million apprenticeships in technology, technical, and management fields.

Despite the decline in youth joblessness, the 15.6 percent youth unemployment rate remains more than double the 7.2 percent rate for the 25-to-29 group and nearly four times the 4.1 percent rate for the 30-to-59 group, underscoring persistent structural imbalances in the labor market.

Li said the elevated youth unemployment rate is a mix of a chronic oversupply of college graduates and a persistent disconnect between what young people learn and what employers need — particularly as adoption of artificial intelligence accelerates demand for highly skilled workers while education and vocational training fall behind.

The data comes as China prepares for a record 12.7 million college graduates this year, up 480,000 from 2025, according to the Ministry of Education. The influx is expected to keep pressure on youth employment in the coming months.

Li warned that youth employment pressure will persist over the next decade as graduate numbers continue to climb, though he added that the central government's sustained employment first policies should help keep the situation on track.

"With employment pressure remaining intense this year, it is essential to keep pushing the employment first strategy and policy support — that is the bedrock for lasting stability in youth jobs," Li said.