Youth unemployment in China climbed to nearly 19% in August, its highest level so far this year, according to official data. Analysts say that the higher level of youth unemployment is driving more college graduates to enroll in graduate schools to escape the job search as the world’s second-largest economy struggles.

According to data released by the National Bureau of Statistics, or NBS, late last week, the unemployment rate among 16- to 24-year-olds rose from 17.1% in July to 18.8% in August. One big reason for the uptick in joblessness, the NBS said, is that nearly 12 million students graduated from Chinese universities this June, heightening competition in an already tough job market.

Postgraduates overtake graduates

“The job market has shrunk, and at the same time there are still so many graduates. Too many people are idling every day,” said Lin Chan-Hui, an assistant professor of the General Education Center at Feng Chia University in Taiwan. “Another way out is to return to school to study further and temporarily escape the competitive workplace.”

Some Chinese universities say they are seeing more postgraduate students than undergraduates.

According to the state-backed digital publication The Paper, the number of graduate students at Lanzhou University exceeded the total number of undergraduate students for the first time. Lanzhou University is located in the capital of northwestern China’s Gansu Province.

In eastern China’s coastal Zhejiang Province, the Zhejiang University of Technology shows 5,382 new graduate students were admitted this year, beating out the number of new undergraduate students by 40.

The trend was already picking up at more famous Chinese universities last year.

Last December, Beijing’s Tsinghua University said the number of undergraduate freshmen in the previous academic year was 3,760, while the number of master's and doctoral students was 12,069.

Shanghai’s Fudan University in October 2023 reported 15,000 undergraduate students and nearly 37,000 graduate students.

China's Ministry of Education said that last year there were more than 47 million people enrolled in higher education institutes, 1.3 million were graduate students, according to the official Xinhua News Agency.

Lei, a higher education consultant in Shenzhen, who due to the sensitivity of the subject only gave his surname, told VOA the trend of higher education is moving toward "college graduates who don’t go to graduate school would immediately become unemployed" amid China's economic slowdown.

"On one hand, studying in graduate school can really help you find a job. On the other hand, it’s also an avoidance mentality,” Lei said.

Wandering masters and doctors

Feng Chia University’s Lin said that having an undergraduate degree is not enough in fields like technological innovation and scientific research, so it is still necessary to get a postgraduate degree in certain fields.

On the other hand, he said, China has too many people getting doctorates and master’s degrees and not enough technical and vocational education so there will be "fierce competition for upper-level work, but no one does the lower-level work." Highly educated young people are not willing to engage in grassroots work, Lin said, so there will be more and more "wandering masters and doctors."

Lin said the geopolitical tension between China and the U.S. has also made studying abroad for a postgraduate degree harder, so more students choose a domestic one instead.

Chinese netizens seem to agree that waiting for the job market to improve is their best hope.

A Hunan netizen on China’s Weibo social media platform under the name "Da Ke Ya Tang" said: "The market will not be able to provide so many jobs in the foreseeable future, so we have to leave the problem to the future."

"If colleges and universities cannot adapt to the country's demand for innovative and pioneering talents and reform the way students are trained, more employment pressure may accumulate in society in a few years," writer Wang Guojin said in a post on Weibo.

COVID students coping?

A PhD student in Shanghai who, due to the sensitivity of the subject, only gave his surname Zeng, told VOA the increase in master's and doctoral students is also because many graduate students went to college during the COVID-19 pandemic and are struggling to adapt. Zeng blames remote learning for their struggles with social interaction and the skills needed to compete in the job market.

"This group of college students obviously lacks some socialization skills, at least in recruitment interviews,” Zeng said. “They can't reach the same level as the previous students.”

Zeng adds that monthly stipends for master's and doctoral students ranges from roughly $143 to $700 and Chinese universities encourage entrepreneurship by providing funds to start small projects through competitions.

“Who wouldn’t want to continue their studies and earn money at the same time?” she asked.

Adrianna Zhang contributed to this report.