September 19, 2020

The Education Revolution: Faltering Economy in China Dims Job Prospects for Graduates

Businesses say they are swamped with job applications but have few positions to offer as economic growth has begun to falter. Twitter-like microblogging sites in China are full of laments from graduates with dim prospects.

The Chinese government is worried, saying that the problem could affect social stability, and it has ordered schools, government agencies and state-owned enterprises to hire more graduates at least temporarily to help relieve joblessness. “The only thing that worries them more than an unemployed low-skilled person is an unemployed educated person,” said Shang-Jin Wei, a Columbia Business School economist.

Lu Mai, the secretary general of the elite, government-backed China Development Research Foundation, acknowledged in a speech this month that less than half of this year’s graduates had found jobs so far.

Graduating seniors at all but a few of China’s top universities say that very few people they know are finding jobs — and that those who did receive offers over the winter were seeing them rescinded as the economy has weakened in recent weeks.

“Many companies are not expanding at all, while some of my classmates have been hired and fired in the same month when the companies realized that they could not afford the salaries after all,” said Yan Shuang, a graduating senior in labor and human resources at the Beijing Institute of Technology.

Ms. Yan said she had been promised a job at a sports clothing company over the winter. But the company canceled all hiring plans in March as the economy weakened.

China quadrupled the number of students enrolled in universities and colleges over the last decade. But its economy is still driven by manufacturing, with a preponderance of blue-collar jobs. Prime Minister Li Keqiang personally led the cabinet meeting, on May 16, that produced the directive for schools, government agencies and state-owned enterprises to hire more graduates, a strategy that has been used with increasing frequency in recent years to absorb jobless but educated youths.

“Any country with an expanding middle class and a rising number of unemployed graduates is in for trouble,” said Gerard A. Postiglione, the director of the Wah Ching Center of Research on Education in China at Hong Kong University.

A national survey released last winter found that in the age bracket of 21- to 25-year-olds, 16 percent of the men and women with college degrees were unemployed.

But only 4 percent of those with an elementary school education were unemployed, a sign of voracious corporate demand persisting for blue-collar workers. Wages for workers who have come in from rural areas to urban factories have surged 70 percent in the last four years; wages for young people in white-collar sectors have barely stayed steady or have even declined.

Economists have long estimated that the Chinese economy needs to grow 7 or 8 percent annually to avoid large-scale unemployment. But that rule of thumb has become less reliable in recent years as the labor market has split.

Relatively slow growth is still creating enough jobs to provide full employment for the country’s blue-collar workers. But much faster growth may be needed to create white-collar jobs for the graduates pouring out of universities.

The International Monetary Fund predicts the Chinese economy will grow 7.75 percent this year — slower than the growth of 10 to 14 percent before 2008, but still a much faster pace than in the West. The main problem for China lies in the sheer growth in graduates; the United States produces three million graduates a year, while China has increased its annual number of graduates by more than five million in a single decade.

Keith Bradsher reported from Hong Kong and Sue-Lin Wong from Beijing. Chris Buckley contributed reporting from Hong Kong, and Mia Li contributed research from Beijing.

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As Pollution Worsens in China, Solutions Succumb to Infighting

So severe are China’s environmental woes, especially the noxious air, that top government officials have been forced to openly acknowledge them. Fu Ying, the spokeswoman for the National People’s Congress, said she checked for smog every morning after opening her curtains and kept at home face masks for her daughter and herself. Li Keqiang, the new prime minister, said the air pollution had made him “quite upset” and vowed to “show even greater resolve and make more vigorous efforts” to clean it up.

What the leaders neglect to say is that infighting within the government bureaucracy is one of the biggest obstacles to enacting stronger environmental policies. Even as some officials push for tighter restrictions on pollutants, state-owned enterprises — especially China’s oil and power companies — have been putting profits ahead of health in working to outflank new rules, according to government data and interviews with people involved in policy negotiations.

For instance, even though trucks and buses crisscrossing China are far worse for the environment than any other vehicles, the oil companies have delayed for years an improvement in the diesel fuel those vehicles burn. As a result, the sulfur levels of diesel in China are at least 23 times that of the United States. As for power companies, the three biggest ones in the country are all repeat violators of government restrictions on emissions from coal-burning plants; offending power plants are found across the country, from Inner Mongolia to the southwest metropolis of Chongqing.

The state-owned enterprises are given critical roles in policy-making on environmental standards. The committees that determine fuel standards, for example, are housed in the buildings of an oil company. Whether the enterprises can be forced to follow, rather than impede, environmental restrictions will be a critical test of the commitment of Mr. Li andXi Jinping, the new party chief and president, to curbing the influence of vested interests in the economy.

Last month, after deadly air pollution hit record levels in northern China, officials led byWen Jiabao, then the prime minister, put forward strict new fuel standards that the oil companies had blocked for years. But there are doubts about whether the oil companies will comply, especially since oil officials resisted a similar government order for higher-grade fuel four years ago. State-owned power companies have been similarly resistant. The companies regularly ignore government orders to upgrade coal-burning electricity plants, according to ministry data. And as with the oil companies, the power companies exert an outsize influence over environmental policy debates.

In 2011, during a round of discussions over stricter emissions standards, the China Electricity Council, which represents the companies, pushed back hard against the proposals, saying that the costs of upgrading the plants would be too high.

“During the procedure of setting the standard, the companies or the industry councils have a lot of influence,” said Zhou Rong, a campaign manager on energy issues for Greenpeace East Asia. “My personal opinion is even if we have the most stringent standards for every sector, the companies will violate those.”

On Feb. 28, Deutsche Bank released an analysts’ note saying that China’s current economic policies would result in an enormous surge in coal consumption and automobile sales over the next decade. “China’s air pollution will become a lot worse from the already unbearable level,” the analysts said, calling for drastic policy changes and “a strong government will to overcome the opposition from interest groups.”

The report estimated that the number of passenger cars in China was on track to hit 400 million by 2030, up from 90 million now.

Mia Li and Amy Qin contributed research from Beijing, and Chris Buckley contributed reporting from Hong Kong.

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Russia Is Invited to Join O.E.C.D. Anti-Bribery Pact

MOSCOW — A group of nations working to outlaw bribery in international trade invited Russia to join their pact at a ceremony Wednesday in Paris, after the Russian Parliament passed a law this spring prohibiting Russian companies from bribing foreign officials.

The ceremony was the beginning of Russia’s application process to join the Organization for Economic Cooperation and Development’s anti-bribery convention, which began as an initiative to ban kickbacks and corruption in transnational deals.

It was also a step toward full O.E.C.D. membership for Russia, because acceptance into the anti-bribery convention is a requirement for aspiring members. Russia first asked to join in 2007, along with Chile, Estonia, Slovenia and Israel. The other four are already members.

All 34 members of the O.E.C.D., as well as four nonmembers, have signed the anti-bribery convention. Secretary of State Hillary Clinton attended the ceremony at the organization’s headquarters in Paris, highlighting the convention’s importance to the United States.

“This is an important step for Russia and for all members and partners of the O.E.C.D.,” Mrs. Clinton said. “Russia has removed a major obstacle to doing business and advancing economic growth.”

She also spoke broadly about state-owned enterprises, without mentioning Russia specifically. “We recognize that countries will make different choices about how much of their economies to keep in the hands of government,” she said. “Still — whether they are owned by shareholders or states — all companies should operate on a level playing field.”

A working group will now gauge whether Russia’s new legislation adheres to its standards. Bribery and other forms of corruption are a scourge inside Russia. The new law, however, addresses bribery outside Russia’s borders. Similar to the Foreign Corrupt Practices Act in the United States, it criminalizes the payment of a bribe by a Russian to an official of a foreign government.

Russia has not committed to stricter measures against bribery at home. Transparency International, the anticorruption group, ranks Russia 154th in the world on its 2010 Corruption Perception index, tied with Papua New Guinea, Laos, Cambodia, a number of African countries and Tajikistan.

The United States encouraged other O.E.C.D. countries to adopt legislation similar to its own law as it became clear that however helpful it was in diminishing corruption in other countries, it was putting American companies at a disadvantage.

The O.E.C.D. convention took effect in 1999. Since then, governments have made headway in pursuing companies that pay bribes.

The new law in Russia raises the existing fines that can be levied on Russian companies that bribe foreign officials and imposes new criminal responsibility. But, recent cases have called into question Russia’s commitment to transnational prosecution of bribery infractions. Even in instances where Germany and the United States have prosecuted their own citizens or businesses for bribing Russian officials, Russian law enforcement agencies have not picked up the lead.

Steven Lee Myers contributed reporting from Paris.

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