China unveils plan to boost employment with a focus on youth

BEIJING (Reuters) – China’s cabinet on Wednesday unveiled plans to boost employment, including supporting financial institutions to offer loans to small firms and issuing subsidies to firms that hire college graduates or unemployed young people.

The world’s second-largest economy reported better-than-expected growth in the first quarter after the lifting of stringent COVID-19 curbs, but the jobless rate for those aged 16 to 24 rebounded close to a record high in March, creating a headache for policymakers.

The cabinet said in a statement that China would issue subsidies to some firms that hire college graduates and unemployed youths till the end of this year and would encourage state-owned firms to expand their recruitment.

Financial institutions would be encouraged to offer loans to small firms to create new jobs, the statement said.

Private firms, which are mainly small firms, have been a driving force behind China’s economic ascent in the past four decades and provide 80% of urban employment. They have been hit hard by anti-virus lockdowns and restrictions over the past three years. Official data in March showed public investment outpaced private investment.

Amid weak private business confidence, the cabinet said job hiring of college graduates at government departments should be maintained. Reuters previously reported that some of most indebted local governments were on a hiring spree this year.

The cabinet also asked companies, public institutions and social organisations to come together to provide at least 1 million internship to young job seekers.

It said the country would encourage and invest in entrepreneurs, including college graduates and migrant workers who want to start businesses.

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