Johnson Yang had ticked just about every box on the long list to achieve his dream career when he made the decision to walk away.
The 26-year-old Chinese student was in his final year of a postgraduate law degree at one of China’s most prestigious universities.
In June last year, he secured an internship at a law firm in Shanghai, China’s wealthiest city where many global top 500 companies reside.
But Yang soon realised the legal profession wasn’t as glamorous as he expected — even as an intern, he was frequently rostered to work overtime, with little pay. It was stressful and tiring.
He also began to worry about whether he would be able to land a job in the competitive legal sector, alongside 11 million university graduates entering the job market.
In July — while Yang was still completing his internship in Shanghai — China recorded an unemployment rate of 21.3 per cent among those aged 16 to 24, before Beijing paused publishing its figures for the rest of 2023.
The latest government data published in January showed an improvement, to 14.9 per cent. However, that figure doesn’t take the student population into account, and many young people in rural areas are also excluded.
The tough situation prompted Yang to rethink his future.
“I want to consider other alternative career pathways,” he said.
So, like 3 million other young people struggling to navigate China’s declining economic prospects, Yang looked to government jobs, a career pathway that’s also popular among young Australians for its financial stability.
But experts warn the shift from private to public sectors among China’s youngest workers could come with consequences for the economy, while Australia’s multi-billion-dollar higher education industry could reap the benefits.
The ‘iron rice bowl’ is no longer for life
In recent years, jobs in China’s government and public sector have been described as “the iron rice bowl”, meaning they are jobs for life.
The term was first used to refer to jobs in China’s state-owned enterprises prior to the 1970s, at a time when the country’s economy was still structured around the Communist model of government.
During this time, state-owned enterprises were dominant and workers generally kept their jobs for life with stable incomes.
In the 1980s, in the wake of low productivity and a growing economic crisis, the Chinese Communist Party launched a reform, embracing market economy.
It trimmed down the number and size of the country’s state-owned enterprises, while launching new policies to boost private sector and foreign investments.
The reforms laid the foundation for China’s rapid economic growth, but also led to a huge unemployment wave among state-owned enterprise workers in the 1990s.
The term “iron rice bowl” grew to include jobs in government and public sector, as many people believed these were more stable and safer careers.
But with the rapid development of the corporate and private sectors, the new iron rice bowl no longer dominates China’s economy.
Government data shows that in 2023, more than 90 per cent of China’s corporations were privately owned. The sector hired more than 80 per cent of labourers in urban areas, including almost half of the university graduates.
The private sector contributed more than 50 per cent of taxes and 60 per cent of China’s GDP.
Nevertheless, there has been a rise in Chinese university graduates applying for government jobs in the past four decades.
But it’s not easy to get a foot in the door in the public sector.
The long road to becoming a public servant
In China, there are two main pathways for those who want to become a public servant: direct recruitment and exams.
Direct recruitments are only available for low-level governments and public institutions, so many young people tend to apply for public jobs through the exam system, which generally provides more future promotion opportunities.
Before they start studying for the public service exams, prospective workers must first apply to sit the test.
These exams test general education to around a Year 9 level, plus specialist university knowledge relevant to the position and department applicants are hoping to work in, such as accounting.
Applicants are also tested on political theories related to Xi Jinping’s leadership of the Chinese Communist Party.
Despite the assessment level, the high demand for public service jobs — as many as 6,000 applicants for one job — means many young people commit to long-term preparation to achieve high scores in the exams.
Yang spent eight hours a day for four months revising before he sat the annual exam in November.
“Knowing how to answer the questions isn’t enough, you also have to answer all of them at a fast pace,” he said.
“There are lots of questions to answer, you have to complete one every 20 to 40 seconds.”
As part of his preparation, Yang watched online lectures and did mock tests, while many applicants also choose to take specialist tutoring for the exams.
According to a report in 2020, the annual profit for public service exam tutoring reached $2.59 billion.
Despite the drills and efforts, Yang didn’t progress to the next round of public service exams.
“It’s certainly not a good thing that so many young people look for jobs in the public sector,” he said.
“I think all young people have their dreams and pursuits, but now everyone doesn’t want to pursue what they dream of, there’s definitely a deeper reason for it.”
Yang believes the lack of confidence in China’s economy has turned young people away from working in other sectors.
“Everyone is now trying to get into public services, because if we get in, then we at least don’t need to worry about losing jobs five or 10 years later, or having a middle-age career crisis,” he said.
China’s economy may be at further risk
The rapid growth of applications to public service jobs is a result of China’s economic slowdown since the pandemic, according to Yasheng Huang, an economist at the Massachusetts Institute of Technology.
“That’s a result of the policy choices that Chinese leadership has made: cracking down on the private sector during COVID; resorting to very strict controls of the population; [the] deterioration of relationship with the West; and the securitisation of policy,” Professor Huang said.
Professor Huang also said the limitations of China’s economic growth model, which focuses on real estate infrastructure investment rather than boosting average disposable income, has also resulted in fewer career choices for young people.
“In the past 45 years, the [public] service exam was popular, but it was competing with other things,” he said.
“But now because the economy is growing very, very slowly, other [career] options are disappearing.”
And that’s a bad sign for China’s worsening economy, said Professor Huang.
“I think China needs entrepreneurs and talented people to start new businesses and to contribute to broader economic growth,” he said.
“Even the best-running government in the world does not create economic growth by itself. The contribution by the government to the economy is that the government creates a good business environment.
“But the actual creation of wealth, actual creation of technology, has to be done by people in the private sector.”
Professor Huang said while the rising interest in the public sector had brought more talent with a variety of skills into the system, it had also made governments larger, at a time when local governments needed to cut expenses.
Last October, China’s Ministry of Finance stated that the debts of local governments exceeded $8.6 trillion, urging local governments to refinance.
Following the announcement, Chinese media reported some local governments from less developed regions were forced to scale down and lay off their staff.
Chinese youth want alternatives, with eyes on Australia
Since 2022, the high youth unemployment rate in China has seen many young people try to seek alternative careers, with some choosing to be “full-time children”, online influencers, or moving to the countryside to escape pressures in the cities.
At the same time, millions of university students have decided to push back their graduation by applying for postgraduate studies, hoping to delay their entrance to the labour market.
The two major trends of Chinese young people’s career preferences — pursuing postgraduate study and seeking public service jobs — are also reshaping Australia’s international education system, which relies heavily on Chinese students.
Last year, China loosened restrictions for graduates studying in foreign universities to apply for government jobs.
The move prompted a growing discussion among Chinese international students on social media about their new potential career options.
Henry Zhang, a 24-year-old studying mining in China, is preparing to sit the public service exams in the next few years, and he already received postgraduate offers in mining from several Australian universities.
He believes his new international education experience could make him stand out when applying for public service jobs.
“International students have global vision and strong cross-cultural communication skills. They could help improve the overall quality of public workforces and governments better interact with the world,” Zhang said.
Zhang feels that Australian universities have a “comprehensive” career support system for graduates, but need a better understanding of the situations that international graduates face when applying for public jobs in China.
Angela Lehmann, head of research at international education consultancy firm The Lygon Group, has also observed the growing trend, but believes there are other factors at play.
“We’re seeing an increase in Chinese young people and students talking about mental health. This is something that prior to the pandemic wasn’t talked about quite as openly,” Dr Lehmann said.
She said in the past, many international students came to Australia with the hope of seeking a global career in private or foreign-invested corporations.
But Dr Lehmann believes the long working hours and mass layoffs as a result of the Chinese government’s crackdown on the private technology sector have made many students rethink what they really want.
She also noticed an increase in Chinese students coming to Australia for the relaxed lifestyle, perhaps seeing studying abroad as an option to escape or delay their entrance to China’s tough labour market.
“I think what universities in Australia could do to respond is [to] really engage with understanding the diversity within the Chinese international student cohort,” Dr Lehmann said.
“The other thing is really just thinking about these new career paths and ambitions of students and ensuring that courses are tailored and made available to Chinese international students.
“And emphasising the advantages of an international education in Australia — one of which is that you can tailor your degree really to suit your shifting needs — which is something that’s often not available in other countries such as China.”
Where one door closes, another opens
For Johnson Yang, the highly competitive environment has pushed him to think about what he really wants for his career.
He was supposed to sit another public service exam over the weekend. But instead, he started a new internship at a law firm in Guangzhou, in southern China.
The past four months of preparing for public service exams made Yang realise his passion for law. He also recognised that tough competition for public service jobs could open up new opportunities in the private sector.
“There are so many people competing for public service jobs, meaning that many companies actually can’t fill their vacancies at the moment. Now that good students all turn to the public sector, there are more options for others,” he said.
He also had a suggestion to his peers.
“Don’t just follow others’ opinions when it comes to choosing your careers, especially when you have other options available to you. Maybe some jobs do start with a relatively lower salary, but you can still give it a go.”