Young Chinese cannot find work: another problem for Xi Jinping

A young man walks past closed food stalls in a shopping center in Beijing on August 15, 2023. Global stock markets fell on August 15, after disappointing data from China heightened concerns about the state of the second largest economy of the world (AFP) (GREG BAKER/)

In August, the Chinese government made shocking data public. A record number: 21.3% of Chinese citizens aged 16 to 24 in cities were unemployed. It immediately decided to suspend future publication of its urban youth unemployment rate. The current data is bad enough; This is the same youth unemployment rate throughout middle East on the eve of the Arab Spring.

He Chinese Communist Party (PCC) knows very well that the young, educated and unemployed concentrated in big cities have the ability to challenge authority. After all, that’s how he started his own party. For decades, the legitimacy of the party-state depended on economic growth and improved living standards, which are now in danger. Instead of meeting the needs of frustrated youth by generating new jobs and opportunities, the elderly leaders have redoubled authoritarian repression as the main political response to the worsening economic crisis.

It is not the first time that the PCC faces urban unemployment. For more than 70 years, the problem has worsened to be contained by the political repression or relieved by favorable economic developments.

After the founding of the people’s republic In 1949, Chinese peasants fled the ruined countryside in search of work in big cities. To curb this migration, the party imposed new rules that prevented citizens from accessing social services outside their registered hometowns. Protected from competition from rural job seekers, city dwellers had more secure employment.

New shocks to the economy and demographics once again increased the threat of youth unemployment during the fifties and sixties. With the economy reeling after the disastrous Great Leap Forward and the loss of Soviet aid, a generation of baby boomers urban Chinese was about to graduate into a worsening job market. In 1966, Mao Zedong launched the cultural revolution to partially redirect these young people, who ended up causing so much unrest that Mao changed course, launching a national movement of “Go down to the field” to force an entire generation of urban youth to till rural fields.

At the end of the 90s, state companies, pillars of the economy of the era Mao, carried out widespread layoffs as part of market reforms, once again threatening urban employment. The Asian financial crisis exacerbated the situation, and laid-off state workers and pensioners protested in northeastern rust belt cities. China. the entrance of China in the World Trade Organization in 2001, which brought with it an increase in foreign investment and employment, saved the situation.

China is repeating this cycle once again, and as expected, the government is responding with repression. This time, the party does not seem to have any tricks up its sleeve and, once the boom period is over, the Chinese economy will find it increasingly difficult to get out of its problems.

Chinese GDP growth has slowed drastically since the early 2010s, and the economic rebound following pandemic lockdowns has been disappointing. At the same time, an expanding higher education system is producing increasing numbers of graduates who are no longer content with the tedious factory jobs of yesteryear.

Instead, many recent graduates have opted for jobs in the fast-growing sectors of technology, real estate and tutoring. But the Chinese government has cracked down on those three industries since 2021 to curb what the president Xi Jinping calls the “disorderly expansion of capital”. Last year, Alibabathe e-commerce giant, ended up laying off more than 10,000 employees. Country Garden, one of the largest real estate developers in the country, cut its workforce by more than 30,000 people. A major education company cut 60,000 jobs in 2021.

The government is also turning to a old playbook. Already in 2018, Xi He called for a campaign to send young people from the cities to the countryside, with calls renewed every two years. Even if the city’s youth were really interested in answering that call, this is not the field of their parents’ youth: arable land has been shrinking.

If the government does not boost household consumption or loosen its grip on China’s private sector, high urban unemployment – youth discontent – is here to stay. In recent years, many disillusioned young Chinese have joined an anti-work movement known as “lie down”, loafing as a form of silent resistance. An economist from the Peking University who studied this movement estimated that, if those who voluntarily “go to bed” are taken into account, almost half of all young Chinese could be unemployed.

Problems like these invite speculation that control of the Communist Party is threatened, but that’s premature. From the late imperial era until today, dispersed protests rarely posed a substantive challenge to central government control; Protesters’ demands were often directed to local officials. They only became a serious problem on rare occasions, when disillusioned intellectuals united isolated protests into an organized movement demanding fundamental change in the system, which is what communist activists did in the early 20th century.

Today there is no such threat on the horizon. Aware of this dynamic, the PCC has harshly repressed intellectuals. Human rights lawyers, feminists, LGBT activists and even young Marxists have been arrested or their organizations have been dissolved.. New technologies, such as facial recognition, widespread security cameras, and cell phone tracking, provide the government with greater ability to monitor people’s movements and thoughts. This totalitarian turn has been so complete that China is increasingly being compared to North Korea. Given the party’s history, it is clear that these actions are aimed, at least in part, at containing the political consequences of the worsening economy.

Autocratic governments in economic difficulties such as those of Myanmar, Iran, Venezuela and Russia They have managed to brutally suppress large-scale protests. There is no reason for the regime Xiwhich has perfected the repressive infrastructure over the last decade, cannot do the same.

He PCC seems determined to use repression as the main political response to the economic slowdown. But while this may prevent threats to the regime, it will put the Game into an even deeper hole by guaranteeing a further strangulation of the country’s economic dynamism.

The tug-of-war between an increasingly disaffected youth and a ruthless, insecure regime will define not only China’s political trajectory, but also its economic future..

* Ho-Fung Hung is a professor of political economy at Johns Hopkins University