China Job Market Still Showing Strains After a Year of Recovery

(Bloomberg) --

China’s labor market is still showing signs of strain a year after the pandemic hit.

The economy is facing both a shortage of skilled workers and high and rising unemployment among young people, the National Bureau of Statistics said Friday. Those issues seem to have caught the attention of top leadership, with President Xi Jinping this week calling for more high-level vocational schools and more training of skilled workers to improve the manufacturing and services industries.

“The pressure on total employment is still relatively large this year,” Liu Aihua, spokeswoman of the National Bureau of Statistics, said at a press conference Friday. “At the same time, structural contradictions have also appeared in the process of economic recovery.”

About 44% of Chinese companies said their biggest problem is recruiting workers, according to a recent statistics bureau survey of more than 90,000 companies. That percentage is the highest in recent years, and the problem is universal among companies in China’s industrial and export-oriented provinces on the coast, Liu said, with demand high for both general workers and skilled staff.

There were almost 3 million new urban jobs in the first quarter of this year, 27% of the full-year target of more than 11 million, Liu said. However, the surveyed urban jobless rate remained elevated at 5.3% in March, and 13.6% of people aged 16-24 were jobless. That’s even higher than last March, when the pandemic hit China the hardest, Liu said.

“To solve the employment problem of young people will still take some time,” she said.

Another sign of the lingering effects from last year’s pandemic shutdown is the decline in the number of migrant workers. There were 2.46 million fewer domestic migrant workers in the first quarter compared to the same period in 2019, Liu said, as companies in labor-intensive service sectors still face operational difficulties.

©2021 Bloomberg L.P.