China pushes to ease grim graduate unemployment

BEIJING Wed Jan 7, 2009 9:06am EST

Graduates throw their mortar boards during their graduation ceremony at Fudan University in Shanghai June 28, 2006 REUTERS/Aly Song

Graduates throw their mortar boards during their graduation ceremony at Fudan University in Shanghai June 28, 2006

Credit: Reuters/Aly Song

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BEIJING (Reuters) - China will push a rising tide of university graduates to find work in the countryside and small firms after Premier Wen Jiabao warned on Wednesday that they face a "grim" job market as a global slowdown seizes the economy.

Wen laid out broad policies to help higher education graduates who are struggling to find work because falling exports, factory closures and consumer gloom are deterring employers from taking them on.

"Faced with the spreading international financial crisis, our country's employment situation is extremely grim," he told a meeting of the State Council, or cabinet, the government's official website (www.gov.cn) reported.

"We must make the employment of higher education graduates a priority," he said.

China has more than economic reasons to fear surging graduate unemployment. It is also a potential political time bomb.

This year will mark the 20th anniversary of the crackdown on pro-democracy protests led by radicalised students. Unsettling discontent could spread again as millions of graduates, whose families have paid steeply for their education, look for work.

The government has encouraged more students to go to university as a way to boost skills and consumer spending, but at the end of 2008 about 1 million of that year's graduates had not found work.

With some 6.1 million students leaving colleges and universities in 2009 -- about half a million more than last year -- labor authorities have repeatedly warned them not to be fussy.

Graduates would be encouraged to find jobs at the urban and rural "grassroots" in poorer western regions and in small- and medium-sized businesses, Wen said.

Larger employers and research projects would also be encouraged to absorb graduates. Dropouts in serious hardship will be offered aid, Wen said, but the report did not say what form the encouragement would take.

Desperate graduates are clamoring to find posts as nannies and domestic helpers for the rich in the southern province of Guangdong, China's export heartland, the Guangzhou Daily, the provincial government's mouthpiece, said on Wednesday.

There have been 500 or 600 people applying every month, with more than 90 percent of them university students, including 28 masters students, the newspaper quoted a housekeeping recruitment agent as saying.

Only 300 out of 2,000 students had landed jobs over the past few months, however, as slowing growth had seen companies go bankrupt and foreign businessmen desert the province in droves, the agency said.

(Reporting by Chris Buckley and Ian Ransom; Editing by Benjamin Kang Lim and Paul Tait)

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