News Analysis

Ask anyone on Capitol Hill who the main rival to the United States is, and the answer will come at you quickly. It’s China. No other country compares.

China is a near-peer rival in numerous economic sectors, as the White House admitted on Friday in their National Security Strategy document. This includes sectors like automotive and space industries, where China is now landing robots on the moon and the United States is not. In other sectors, they are an indispensable partner, as is the case with biotech, or are leading the world, as they are in renewable technology like solar.
But with a look closer at China’s under-30 crowd, the picture is different. China no longer looks like an unstoppable country on the cusp of surpassing the United States. It is a country facing serious growing pains. The real estate market is no longer what it once was and China’s GDP growth rate, while still strong according to a recent Goldman Sachs projection, is not what it was pre-pandemic. Socioeconomic risks abound.

In many ways, it looks like the United States before the trade protectionism of the first Trump presidency, whereas a key service sector was struggling (real estate) and the relentless outsourcing of labor made people more cynical and less optimistic.

Media coverage of China’s youth unemployment problem is growing. Much of it reads like a sad soap opera, full of video clips of young university-educated girls working as motorcycle delivery drivers for Ele.me, in cities already saturated with delivery drivers and experiencing lackluster customer demand.
On Aug. 10, the BBC published an eye-opening feature about China’s under-30 workforce turning to “pretend-work” arrangements—a phenomenon tied to depressed formal hiring, where young people actually pay an entrepreneur a small monthly fee to sit at a desk and look for jobs, all the while telling their family they have an internship somewhere.
The report serves as strong anecdotal evidence of under-employment or “hidden unemployment.”For Some, Old China Better Than New ChinaChina’s 10 percent GDP growth is a thing of the past. Economic growth has slowed, with multinational companies moving to Southeast Asia and investing in Mexico. The Chinese Communist Party’s “Five Year Plans” are focused on advanced technology sectors that do not always benefit blue collar workers.

Since the economic fiasco of the pandemic, courtesy of CCP’s draconian lockdown policies and the global supply chain response, hundreds of thousands of businesses have closed. Wage cuts and layoffs continue across China’s manufacturing sectors too. Many young people cannot find work in crowded cities, where wages for entry level work are often depressed thanks to competition from migrant workers from towns further away.

NTD TV interviewed some young Chinese workers in November about the new realities on the ground.

One woman, listed only as Ms. Zhang, was a college graduate from the city of Yuncheng in Shanxi, an interior Chinese province. “I felt there was no hope in going to work anymore,” she told NTD TV. “When I worked in Shenzhen, you earned in Shenzhen and spent in Shenzhen. Nothing was left. I lived paycheck to paycheck.” She returned home to work on the family farm. She now lives with her parents.

Others are still trying to make a go of it in China’s big cities. These are the “rat people”—a play off of the old “rat tribe” phrase used to describe migrant workers who live in small, cramped quarters of roughly 50 to 120 square feet.

No one really knows how precarious the situation is for youth unemployment. Official numbers from the National Bureau of Statistics of China (NBS) has urban youth unemployment (ages 16–24, excluding full-time students) at 17.3 percent in October 2025, similar to September’s 17.7 percent.

The same age group had 18.9 percent unemployment in August, one of the highest readings since the return to reporting of youth unemployment.

Hong-Kong-based wealth management firm Arc Group warned in a report to its clients this spring that youth unemployment is still too high. It cited “deepening mismatches between education outcomes and labor-market needs.” The report also linked weak labor outcomes among youth to structural headwinds like tariffs.
A recent academic article, titled “The Analysis of Factors Contributing to the High Youth Unemployment Rate in the Chinese Labor Market,” put some of the blame on China’s shift to a high tech economy.

This structural transition from export-led growth to a more balanced economic model—something the West has long asked of China—is not without speed bumps.

“The slowing growth and the structural adjustment to high technology have led to reduced demand in traditional industries such as labor-intensive manufacturing, affecting job creation for young workers,” the authors wrote.

China analysts are increasingly connecting youth joblessness with broader structural risks for the economy, and the CCP more broadly.

The China Briefing blog, run by the business consulting firm Dezan Shira and Associates, also noted that better work conditions and benefits are making Chinese labor more expensive. The private sector in China today is repeating what it did in the United States at the end of the Cold War, when they started to outsource goods and services to lower-cost countries. This included giving a huge boost to China’s economy after its entry into the World Trade Organization in 2001.

But now, the tables have turned. China’s labor market is taking the hit.

Left unchecked, high youth unemployment will weigh on China’s long-term growth model and put Beijing leadership to the test.

And it’s not just the under-30 crowd that’s worried about the future.

Migrant workers, the old staple of manufacturing towns on the outskirts of China’s biggest cities, are going home early ahead of China’s Luna New Year in February. Why? Lackluster work hours, The Epoch Times reported on Nov. 21. Recently, the CCP issued notices warning against large-scale return and prolonged stay of migrant workers in their hometowns, triggering public ridicule, the paper reported last month.‘Welcome to Our World, China’For the United States, there is a chance that Beijing will begin understanding Washington’s biggest concerns about globalization and its impact on the domestic labor force. For years, the China-centric globalized model of American supply chains served China’s interest, but it led to massive layoffs and disruption among America’s working and middle classes.

Since tariffs were first imposed on China in July 2018, Beijing is now witnessing what happens to the labor force when its private industries leave for cheaper markets and invest elsewhere instead of at home. Jobs vanish. Young workers struggle to start a life. Older workers are forced to downsize or rely on the state for help.

The United States has gone through all of this before in no small part because of China. Now it’s China’s turn. The new views on global trade in Washington are the cause of major headwinds for China’s centrally-planned economy.

China’s youth unemployment rate was a record low of 9.6 percent in May 2018 and then kept climbing the following five years under the tariff regimes of both the Trump and Biden administrations.

Although China’s official unemployment rate in 2024 dropped, it remains elevated compared to the historical average, indicating that serious social issues continue to exert significant pressure on the job market and China’s policy makers.

Millions of people in China tolerate their ruling class because, in exchange, they were given upward mobility. Ending that social contract does not bode well for the CCP.

Speaking to NTD TV last month, a 35 year old man who goes by Mr. Wang said he returned to his home province of Shanxi after getting laid off in Beijing. Like many Americans, Wang worked multiple jobs to make ends meet. His health insurance premiums were going up despite his flat income. And eventually, he threw in the towel.

To Americans, all of this sounds familiar.

“I make about 130 yuan ($20) a day,” Wang told NTD TV. “Sometimes there is work. Sometimes there isn’t. After paying for rent and buying food, there’s nothing left.”