Lack of skilled labor in China is hampering its economic growth

August 29, 2022 12:10 p.m. STI

beijing [China]Aug 29 (ANI): The economic future of the world’s second largest economy, China, looks sleepy as the growing mismatch between jobs and education has left youth stuck in a cleft.
The rural-urban divide among millions of young Chinese people, due to expensive academics in China, has led to a shortage of skilled labor in the country, thus affecting the already-stricken economy among other factors. , reported the Financial Post.
With each passing year, young Chinese are forced to choose higher education courses due to their low incomes. This in turn leads to a decline in academic performance. As a result, the question facing millions of young people in China after graduating from high school is whether to pursue college or professional education.
The academic course in the country is very expensive and time-consuming. However, the returns are not very encouraging given that dozens of qualified young people with university degrees compete for low-level jobs.
On the other hand, young people prefer vocational education because it is tailored to the skills required for the jobs available in the labor market. But they are poorly paid and lack opportunities for career development.
Young people who come from rural areas prefer vocational education because of their low academic standing. This global employment challenge is exacerbated by global uncertainty, labor market mismatch and over-education.
However, China still faces an oversupply of university graduates and a shortage of skilled workers, and the labor market situation in the country is being tested, the Financial Post reported.
The latest data showed that the share of uneducated workers in China’s labor force is “larger than that of virtually any middle-income country”. There are about 500 million people in China between the ages of 18 and 65 without a high school diploma.
According to available data, “of all people of working age, about 30% have completed lower secondary school, 14% have completed upper secondary school and only 9% have completed upper secondary vocational education” .
There has been a “significant shift from an economy dominated by poorly educated workers to more educated workers, reflecting an overall improvement in the quality of labor supply”.
There has also been an increase in the number of graduates from second cycle vocational education and vocational university graduates in the younger generations.
But this increase is more the result of a government policy to balance professional and university enrollments nationwide than individual decisions. Students are simply reluctant to choose the vocational stream.
According to a research paper, “the number of university enrollments and graduates has increased dramatically in China,” following the global trend of rapidly increasing student enrollment in higher education.

“The increase was so large that data from 2015-2017 showed that the “share of university graduates aged 24-35 exceeded the share of lower secondary graduates – a clear sign of the consequences of rapid growth of higher education”.
The paper states that mass education can compromise the quality of education and can challenge socio-economic development if growth in student enrollment is not accompanied by a commensurate increase in “human support, financial and physical.
The problem is further amplified when university graduates believe that “higher education is an ‘elite education’ and do not accept the ‘blue-collar jobs’ that offer the most dynamic opportunities in China, reported the Financial Post.
In the labor market, employers are “attracted by the abundant supply of highly qualified university candidates and have no incentive to increase the salaries of vocational education graduates” of any level.
Yet the shortage of skilled workers coupled with the oversupply of university graduates has narrowed the wage differentials between postgraduate vocational education graduates and university graduates.
Highly qualified people must adapt to low-skilled jobs and seize the opportunities of less competitive vocational education graduates.
This lessens the attractiveness of vocational education and further depreciates the value of degrees as more and more students turn to university education.
There is also the problem of the gender pay gap that prevails among vocational and university graduates.
At upper secondary and tertiary level, “men are regularly paid 11 to 14% more than women”. Within the same sex, the returns to university education at the tertiary level are more than 20% higher than the returns to professional education.
Yet returns to academic education at upper secondary level are similar to returns to vocational education at the same level, the Financial Post reported.
“A large population of uneducated workers was not a problem when China moved from low to middle income. Wages for the unskilled were low and there was growth in manufacturing and construction low-cost. But China’s growth pattern is changing as it gets richer,” a report addressing the issue said.
He further added that unskilled wages are much higher, but the lure of cheaper labor elsewhere and China’s massive push towards automation is making low-skilled workers laid off.
Construction jobs have shrunk as infrastructure investment cools. These factors suggest that China’s unskilled workers may become increasingly unemployable as the economy modernizes,” said a report addressing the issue.
However, China has long had a culture that demeans vocational graduates and discourages parents from sending their children to vocational colleges. However, Chinese youth must face the reality that education no longer guarantees prosperity – that’s the mantra of the experts. (ANI)

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