Youth unemployment in China could reach levels not seen for more than three years, as record numbers of graduates prepare to enter the job market at a time when artificial intelligence threatens to displace more entry-level jobs.
According to data published this week by the National Statistics Officethe rate of unemployment in urban areas for young people between 16 and 24 years old stood at 14.9% last month. Although this figure extends the seasonal downward trend, it was the highest recorded in June since the government excluded university students from the sample more than two years ago, after exceeding 20% unemployment.
Youth unemployment typically hits its lowest point in June, then rebounds in late summer as more graduates enter the job market. According to the Ministry of Education, a record 12.7 million students will enter the workforce this year, an increase of almost 4% from 2025.
Zhaopeng Xingan economist at the Australia & New Zealand Banking Group, expects youth unemployment to approach 20% in the next two months due to the worsening of excess labor supply. “Pressure on employment continues to increase due to both cyclical and structural challenges,” he said. Xingpointing out factors such as weak domestic demand and the adoption of artificial intelligence in the workplace.
The bleak job prospects for China’s youth highlight the challenge facing authorities following weak economic growth in the second quarter, which fell below Beijing’s annual target. With stagnant consumption and investment, the expansion of AI is driving a transformation that, it predicts Citigroup Inc.could lead to the displacement of some 70 million workers in China.
According to analysts from Hsbc Holdings PlcChina’s AI adoption rate is the highest in Asia and higher than the United States.
