China’s growing youth unemployment rate could trigger political problems if not properly handled, reports The Japan Times, citing a warning from a prominent economist who has advised Chinese President Xi Jinping’s government. “The issue of youth unemployment will likely continue for the next decade and continue to worsen in the short term,” said Liu Yuanchun, who has provided guidance to Beijing on the economy. “If not handled properly, it will spark other social problems beyond the economic arena, even becoming a trigger for political problems,” he said in a joint report published last week by a Renmin University of China think tank, China Macroeconomy Forum.

Last year, Jinping faced the biggest challenge to his power during his decade-plus tenure when nationwide protests, led by students, erupted over strict ‘Covid Zero’ rules, with some calling for the Chinese leader to step down.

China’s unemployment rate among those aged between 16 and 24 reached a record of 20.8% in May 2023. The nation’s slowing economy combined with a flood of new graduates in the market are handing policymakers a challenge with few easy fixes. The report adds that China’s youth unemployment rate stems from a stagnating private sector scarred by Covid restrictions. Yuanchun and his co-authors identified a clear way to defuse the pressure building among unemployed young people: “A more robust economic recovery and labour market recovery are needed.”