Youth unemployment in China surged to 17.1% in July, marking the highest level of the year as the nation grapples with significant economic challenges. This sharp increase reflects a deteriorating job market for younger individuals amid broader economic strains affecting the world's second-largest economy, as reported by AFP.

The latest figures from the National Bureau of Statistics (NBS) reveal a marked rise from June's 13.2%, highlighting growing difficulties for young job seekers. The youth unemployment rate peaked at 21.3% in June 2023 before authorities revised their methodology and ceased publication, excluding students from the figures. This year's increase is partly attributed to the nearly 12mn university graduates entering the job market this June, exacerbating an already tough employment landscape.

Premier Li Qiang has urged that the struggles of businesses be recognised and addressed, stressing the need for government support amid the economic downturn. The broader unemployment rate, including those aged 25 to 29, stood at 6.5% in July, a slight rise from June's 6.4%. Overall, the workforce unemployment rate remains at 5.2%, but this statistic does not account for the rural job market, potentially underestimating the full extent of the employment crisis.

China’s economic challenges extend beyond the job market. Recent data also reveals a slowdown in industrial production growth, which grew by 5.1% in July, down from 5.3% in June and below analyst expectations. The real estate sector continues to struggle, with major cities reporting another decline in property prices, reflecting weak demand.

Compounding these domestic issues are international pressures. The European Union and the United States have been increasingly imposing trade barriers, targeting low-cost Chinese products and addressing concerns about unfair competition. These external factors add to the economic difficulties, as China faces a contracting demand for bank loans, the first such contraction in nearly two decades.

President Xi Jinping has highlighted the importance of tackling youth unemployment as a top priority, underscoring the urgency of addressing the economic pressures faced by the younger generation. As China navigates these multifaceted challenges, the government's response will be crucial in stabilising both the job market and the broader economy.