China Unemployment Hits Record
By Asmita - Sep 17, 2025
China's economy faces challenges as unemployment rates rise, with the August 2025 rate hitting 5.3 percent. Youth unemployment is at its highest level, reaching 18.9 percent for the 16 to 24 age group. Factors include operational difficulties in factories, weak domestic demand, debt crises in the real estate sector, and trade tensions with the US. Economic growth is declining, with a predicted drop to around 4.5 percent in 2025 from the initial 5.4 percent GDP growth rate. Efforts such as increased infrastructure investment and consumer subsidies have been introduced to boost the economy, but concerns persist over consumer spending levels and social implications of the rising unemployment rates.
Unemployment image via Newsbook
,[object Object],, often referred to as the "Dragon's economic flight," is facing challenges this year due to rising unemployment rates. In August 2025, China's unemployment rate rose to 5.3 percent, slightly higher than the 5.2 percent recorded in the previous month. Particularly alarming is the increase in youth unemployment, with the rate for the 16 to 24 age group reaching 18.9 percent. This is considered the highest level since the adoption of the new calculation method. These figures indicate that ,China's economy, is not showing the expected robustness.
The surge in youth unemployment is largely due to operational difficulties faced by factories and weak domestic demand. The Chief Economist of the ,[object Object], (NBS) acknowledged that domestic market demand remains weak, leading many companies to struggle with stability. Additionally, years of debt crises in China's real estate sector and trade tensions with the ,[object Object], are intensifying economic pressure. Retail sales and factory output also showed minimal growth in August compared to the previous year, increasing concerns about an economic slowdown.
China’s economic growth rate is also witnessing a decline. After a 5.4 percent GDP growth rate in the first quarter, it is estimated that the growth rate may reduce to about 4.5 percent in 2025. Global trade uncertainties and weakening domestic demand are cited as major causes of this decline. Although the government has announced some incentives such as increased infrastructure investment and consumer subsidies to stimulate the economy, consumer spending is still below pre-,[object Object], levels.
The rising unemployment rate in China is not only an economic concern but also a social one. Limited job opportunities for youth could increase social tensions and instability. The Beijing government faces several challenges—a weakening domestic economy, increasing trade tensions, and the crisis in the real estate sector. To overcome these, effective policies must be implemented swiftly to gradually remove the brakes on China's economic flight and ensure job creation for young people.
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