Unemployment is becoming a way of life for China’s young

Last month, layoffs at Xingyu Automotive Lighting, a large automotive parts manufacturer in eastern China, left over 100 freshly hired graduates without jobs. Rather than accept poorly paid positions, many chose to resign, sparking widespread outrage. The Communist Party's mouthpiece, the People's Daily, condemned the company for "trampling on society's trust," while Volkswagen, a supplier of Xingyu, launched an investigation into the dismissals.

In response, the company issued an apology, fired its head of human resources, and reduced executives' salaries.

The layoffs reflect the growing youth unemployment crisis in China, where a record 12.7 million graduates entered the workforce in 2023, nearly 500,000 more than the previous year. Despite government efforts to address the issue, youth unemployment reached 20% in 2023, prompting officials to suspend the data and release a lower, yet still concerning, adjusted rate. State-owned companies are now ordered to hire more graduates, but private companies are also feeling the strain.

The industries that once absorbed a large number of young people are now struggling, with regulatory crackdowns reducing tutoring jobs and AI-driven entertainment companies cutting roles. Tech companies are quietly laying off engineers, and the gig economy is becoming overburdened, with average earnings declining.

Some young people are adapting to this new reality by "lying flat," rejecting the intense competitiveness of Chinese society and refusing to actively seek employment. Others have become "full-time children," staying at home to care for their families while earning pocket money. For those who still wish to appear active, "pretend to work" companies have set up offices in cities across China, offering a nominal fee for sitting at a desk and submitting job applications.

Public spaces, such as Beijing's Capital Library, have become popular gathering spots for the "pretend workforce," with tables filled with job seekers and others engaged in hobbies like computer gaming. While many are finding ways to cope with the unemployment crisis, the pressure on China's young population continues to mount.