Why China's graduates are choosing government jobs over private firms

China's weak economy and job cuts in private firms are pushing young graduates towards government jobs, with record applicants chasing stable careers despite tough competition

China’s slowing economy is changing how young people think about their careers. With private companies hiring less, many educated graduates are now choosing government roles for safety and stability. This shift has led to record numbers applying for civil service positions, even as competition for these jobs becomes tougher than ever, CNBC reported.

 

Last month, around 3.7 million people across the country applied for the annual civil service examination. Many of them were graduates from China’s top universities. However, only about 38,100 entry-level government positions will be available from next year, meaning just one out of every 100 applicants is likely to be selected.

 

Despite the low odds, interest in government jobs remains strong. China’s slowing economy, weak business confidence and a prolonged downturn in several industries have sharply reduced opportunities in the private sector.

 

Urban unemployment among people aged 16 to 24 has stayed above 17 per cent since July. By comparison, youth unemployment in the US is close to 10 per cent.

 

‘Iron rice bowls’ regain appeal

 

Government jobs in China were once known as “iron rice bowls” because of their job security, fixed working hours and steady benefits. As the economy opened up over the past two decades, young graduates increasingly preferred higher-paying roles in private companies, especially major technology firms such as Alibaba, Tencent and Huawei.

 

That trend is now reversing. A long economic slowdown, combined with Beijing’s regulatory clampdown on sectors such as real estate, technology and private tutoring, has triggered large-scale layoffs. China’s top 500 private companies cut more than 314,600 jobs last year, the news report said.

 

As job openings shrink and expectations remain high, many young people are lowering their ambitions and turning towards public sector roles.   

 

State firms seen as safer option

 

Within the public sector, many graduates see state-owned enterprises as a safer bet than government agencies, which offer fewer positions and have extremely low pass rates.

 

Wei Shan, a senior research fellow at the East Asian Institute at the National University of Singapore, told CNBC that students have a better chance of getting hired at state-owned companies, which usually offer more positions than government departments.

 

At the same time, interest in private companies is fading. Only 12.5 per cent of graduates sought jobs in private firms last year, down sharply from 25.1 per cent in 2020.

 

Rising layoffs, slower wage growth and weaker job security are driving young people to value stability more than high pay.

 

Government hiring slows despite rising demand

 

While applications for public jobs are surging, government hiring has not kept pace. Local governments are facing severe fiscal pressure due to the property slump and are hesitant to expand payrolls.

 

Although public sector openings jumped sharply in 2020 during the pandemic, the central government has cut planned positions for 2026 by 4 per cent to 38,119.

 

Competition has intensified. About one in 100 applicants will be hired next year, compared with one in 70 in 2023. In some rural posts, the odds are as extreme as one job for every 6,470 applicants.

 

Work-life balance and fading faith in degrees

 

Experts cited by CNBC say the rush toward public jobs is also linked to growing disillusionment with private companies and a stronger desire for work-life balance.

 

At the same time, fewer students are pursuing postgraduate studies. Applications for China’s national postgraduate exam dropped to 3.4 million this year from 4.74 million in 2023.

 

Economists warn that if top talent continues to cluster in government roles, innovation and long-term growth in the private economy could suffer, the news report said.