BEIJING • China's thousands of state-owned enterprises (SOEs), local governments and public institutions are expanding hiring as a record number of students graduate into a job market left reeling by the Covid-19 pandemic.
Around 8.7 million Chinese students are graduating this year, almost half a million more than last year, and are heading into an uncertain future as private companies rein in recruitment.
Job stability for the young is a longstanding political concern in China. President Xi Jinping, who has previously warned that struggling graduates could "turn into negative energy", is urging more hiring.
Graduates, who generally enter the workforce in June or July, face a "severe" situation, officials have said. The number of available positions for them in the recent pre-graduation spring recruiting season fell by 22 per cent on year, according to BOSS Zhipin Research.
While China's gross domestic product bounced back into growth in the second quarter, surveyed unemployment of graduates aged 20 to 24 was more than three times the rate for the broader population, rising to 19.3 per cent in June, 2.1 percentage points higher than May.
SOEs, local governments and public institutions, known collectively as "the system", are responding to Mr Xi's call.
Oil giant Sinopec Corp is more than doubling its 2020 recruitment numbers, with an additional 3,500 positions for new graduates.
In central Henan province, provincial SOEs have been told to expand hiring and reserve at least half the new positions for graduates.
"Clearly, initiatives such as this run counter to the idea that China's SOEs are run on a purely commercial basis," said Mr Louis Kuijs of Oxford Economics. SOEs, which enjoy privileged access to certain sectors, have a "special responsibility" at times, he noted.
Government schemes sending youth to work in less developed areas of China have also been bulked up: one, where graduates help with poverty alleviation and other forms of community support, has 5,000 more places than last year.
Thousands more graduates than in 2019 will be granted passing grades in the highly competitive civil service exams, mainly held in the summer.
Efforts to directly soak up labour are limited as China's private sector accounts for 80 per cent of urban jobs. But SOEs have also been told to help employment indirectly by promptly paying and reducing costs for smaller companies, said Mr Andrew Polk, a partner at Trivium China, a research advisory.
In a letter dated July 7 to graduates embarking on grassroots work in the far-western region of Xinjiang, Mr Xi said he wanted degree holders to "contribute more to the (Chinese Communist) Party, the motherland and the people".