Chinese universities are facing a drop in funding from the government, leading them to increase tuition fees by up to 54%. This spike in costs could be a significant burden for rural families, particularly in light of the soaring youth unemployment rate, where one in five young people are currently out of work.
China’s Generation Z is facing significant challenges, including a slowing economy and high levels of unemployment. The recent decision to raise college tuition fees by such a large percentage will only make life even more difficult for this generation. The tuition hikes will be implemented this year, with some universities in heavily populated provinces such as Jilin and Sichuan increasing fees by up to 41%.
The increase in tuition fees varies between universities. For example, the East China University of Science and Technology in Shanghai announced a 30% increase in annual tuition fees for liberal arts majors, amounting to 6,500 Chinese yuan, or $901. The university’s STEM and physical education majors will face a steeper hike of 54%. Similarly, Shanghai Dianji University stated that it would be raising tuition for STEM majors by 40% and by 30% for management, economics, and literature majors.
Compared to the US and UK, studying at a Chinese university is much more affordable. Times Higher Education reports that undergraduate tuition fees at Peking University range from $3,589 to $4,141 per year, making it approximately 15 times cheaper than Harvard College, which charges $54,269 annually. While college tuition in China is relatively affordable, the sudden increase in fees may place financial pressure on those from lower-income backgrounds.
Keyu Jin, an economist at the London School of Economics, predicts that with the fee hike, tuition fees will average around 15,000 Chinese yuan per year in the pilot cities, which will be a significant burden for rural families who earn an average income of 20,000 Chinese yuan.
The increase in tuition fees was a long time coming. Most Chinese universities receive public funding, but the education ministry has cut funding for higher education by 3.7% from 2022 to 2023, leaving universities with no choice but to raise fees to make up the shortfall. The timing of the fee hikes has received criticism from Chinese citizens, who question the decision given the state of the Chinese economy.
Despite the concerns, some academics argue that the fee hikes are not as significant as they may appear. Wu Xiaogang, a sociology professor at New York University Shanghai, suggests that the rate of the increases is likely equivalent to smaller yearly increases over the past few decades. Mark Greeven, a professor at the International Institute for Management Development China, says that the fee hikes were long overdue, considering rising costs and incomes in the country.
Youth unemployment in China is a significant issue. The country has made higher education more accessible, resulting in a higher tertiary education enrollment rate, which increased to 57.8% in 2021 from 3.4% in 1990. Unlike in the US, where students may choose not to pursue higher education if it doesn’t offer a promising career path, in China, there is a cultural norm to pursue higher education whenever possible. The burden of paying for college falls on families rather than students taking on heavy debt.
However, this means that the younger generation in China will enter a challenging job market, where one in five people their age are unemployed. The economic opportunities and income growth seen in previous decades may not materialize for them. Combined with the rise of a “lying flat” and anti-hustle mentality among millennials, this creates a sense of reduced expectations and anxiety that the Chinese people have not experienced in the last forty years.
The lack of economic opportunities and high youth unemployment have led to widespread disillusionment among China’s youth, with social movements emerging that reject the corporate rat race. Shehzad Qazi, managing director of China Beige Book International, warns that if an entire generation is underemployed, it will exacerbate China’s existing demographic and economic challenges.
Wu Xiaogang from NYU Shanghai believes that the wave of youth unemployment could have long-term negative consequences for their career development. If young people are unable to find employment for an extended period, their prospects may be overshadowed by fresher graduates who enter the workforce when the economy improves.
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