Lower our expectations: It's a job tough market out there

UNCLAS SECTION 01 OF 03 GUANGZHOU 000196

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TAGS: ELAB ECON PGOV CH
SUBJECT: Lower our expectations: It's a job tough market out there

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Summary


1. (SBU) Summary: Don't get your hopes up! That's the message
employment agencies, university career centers and society at large
are sending university graduates in South China. To lower
expectations as students prepare to enter a tough job market,
university employment centers retelling them not to be "picky"
about jobs, yet are taking special measures to improve job-seekers'
prospects. While acknowledging the current economic downturn, a
more fundamental problem, according to one university official, is
the oversupply of college graduates and lack of labor mobility.
Many university officials expressed confidence in the government to
counter the downturn successfully, a view echoed by university
students at a job fair. However, it is unclear how much students
have contemplated what a prolonged economic downturn might mean for
them. End Summary.

A Three-Pronged Attack on High Expectations
--------------


2. (SBU) The government has a three-pronged approach for managing
the expectations of new graduates seeking jobs, according to Nan
Fangsheng, the director of the South China Market of Human
Resources. Employment agencies, university career centers and the
media each play a role in telling university graduates in South
China to lower their expectations as they prepare to enter a tough
job market. Sheng said his center is the largest state-owned
employment agency of its kind in China, last year helping four
million job seekers through job fairs and its website 168.com.
Agencies like his supplement the message of lowered expectations
that students get at their campus career centers. Sheng said that
this message is also reinforced through the "social environment"
primarily from the media.


3. (SBU) Sheng said demand for his center's services had been higher
than in past years, due not only to the economy, but also to the
ever-larger number of college graduates. He added that Guangdong's
draw for workers from surrounding provinces placed additional
pressure this year on the province to help resolve an issue
affecting China nationally. While he could not say what percentage
of students would be unemployed this year, he estimated that roughly
10% of 2008 graduates were still without work. Sheng downplayed the
impact of student underemployment, adding that students would
adjust. Although salary expectations will vary according to the job
offered, Sheng said that students are now asking for starting
salaries of RMB 1,000-3,000 monthly (about US$150-450).

Even the Elite Will Need to "Ride a Donkey"
--------------


4. (SBU) Graduates' salary and overall job expectations are higher
at well-regarded schools like the Guangdong University of Foreign
Studies (GDUFS),but it falls to Ye Zhao, director of the school's
career center, to adjust students' expectations downward. She
stated that traditionally 99% of GDUFS' graduates have found jobs in
foreign-invested enterprises (FIEs) or import/export firms before
graduation, using their foreign language and business degrees.
Starting salaries have averaged 3,500 RMB per month, higher than the
local average, raising graduates' expectations in recent years.
However, this year Zhao and her staff of six are bluntly advising
GDUFS' 5000 graduating students to "lower their expectations and not
be picky." Specifically, guidance counselors are advising students
to broaden their job search beyond FIEs and Global 500 firms and
focus more on domestic small and medium enterprises (SMEs). She
said students have understood the situation and now accept jobs
paying around 2,500 RMB (roughly US$365) a month, but would regard a
monthly salary of 1,000 RMB as unacceptably low.


5. (SBU) According to Zhao, most graduates believe that the economic
downturn is a short-term situation and they are adjusting by
temporarily accepting lower-paying jobs and gaining experience until
better ones open up, or "riding a donkey to seek a horse," as she
put it. About 10% of graduating students will choose to put off
their job search and pursue advanced degrees, either in China or
overseas, to become more competitive candidates, she said. She
expected less than 10% of current graduates to be unemployed six
months after graduation. However, when asked if students were

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optimistic or pessimistic about the economy generally, Ms. Zhao
replied that "students are neither optimistic nor pessimistic - they
are just focused on getting a job." If the downturn were to
continue, she said, students should be proactive and consider
starting their own businesses, looking to the government for help
with loans or training.

A Structural Problem
--------------


6. (SBU) However, the current economic crisis alone isn't enough to
explain the problem university that students face. There is a
fundamental imbalance caused by a structural oversupply of graduates
in the more developed cities of the Pearl River Delta complicating
their job prospects, according to Xiao Ning Feng, the director of
the career center at South China University of Technology (SCUT).
As part of a push to raise living standards and numbers of educated
citizens, Feng said, the government has "encouraged" SCUT to boost
undergraduate spots by 6,000 and post-grad spots by 3,000. Upon
graduating, 80% of the students want to stay in the Guangzhou,
Shenzhen, Zhuhai or other large cities and are not willing to settle
down in what they consider the less-developed "backwaters" of
Guangdong province. Students believe that the larger cities have
better job opportunities; as a result, newly-minted graduates are
pursuing a limited number of "desirable" jobs. SCUT claims its
alumni have done well with 92% graduating with jobs last year. But
Feng estimated that there were about 500,000 job seekers in South
China last year and roughly 20% of them could not find employment.
He also pointed out that job competition had intensified as Chinese
returned home in search of better job opportunities after living
overseas and seeing prospects abroad dry up.

Less Complacent Placement
--------------


7. (SBU) Both SCUT and GDUFS are adopting similar measures to
increase students' chances at finding work. From freshman and
sophomore years, both schools encourage students to study something
"practical," that will lead to good offers. They offer a variety of
job-hunting classes and workshops and maintain in-house databases
and websites where employers and alumni can recruit students. In
addition, each school has organized on-campus job fairs. Zhao from
GDUFS said she was aggressively enlisting professors and alumni to
help graduating students. Aside from these more traditional
methods, Feng from SCUT said he was encouraging graduates to
consider job offers in less-developed cities by facilitating
incentives like student loan forgiveness and emphasizing that
students pursue job experience first and foremost; he also advises
they put off thinking about where to settle down until later. SCUT
has a program that gives students from other provinces a two-year
window to look for jobs nationwide, but Feng acknowledged that if
students do opt for settling down in an "undesirable" area, it may
be difficult to move to one of the more developed coastal cities
because of hukou restrictions.

Students Not Angry, But Goals Are More Modest
--------------


8. (SBU) Conversations with attendees at a 168.com-sponsored job
fair at Guangzhou's University City, the location of ten colleges,
revealed that students have been paying close attention to the
economic downturn. Although some students expressed concern about
their job prospects, none displayed despair or pent-up anger. There
was no sense of bitterness, blame or a feeling of an entitlement
missed after years of hard work. Rather, students seemed to have
adjusted their expectations downward and were focused on achieving
more modest goals. Several said that whereas before they were
expecting RMB 2,500 to 3,000 as a starting salary, they were willing
to accept salaries as low as RMB 1,500. Affirming the assessment of
Feng from SCUT, students from rural areas or other provinces said
they would rather find a job and stay in Guangzhou than return home,
their concern about underemployment tempered by where they wanted to
live. Students from top-tier colleges in the region seemed to be
the least concerned about underemployment or the impact of the
downturn on their job prospects.


9. (SBU) Overall, students were quietly confident that the
government would resolve the problems and the economic situation
would turn around before too long, especially once stimulus spending
begins to have an effect. They acknowledged that they felt pressure
to get a job and succeed, not only for themselves personally, but

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also for their families, especially among those from the
countryside. Many indicated that they would return home and their
parents would support them if they were unable to find a job
quickly. However, when asked what they would do if the downturn
lasted six months, a year or longer, many students seemed baffled
that the downturn could last so long and had not seemed to
contemplate this possibility.


GOLDBERG