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Tue, Jun 29, 2004 - Page 12 News List

Beijing's dazzling figures belie despair of college graduates

ECONOMIC REFORMS Northeast China, once the crown jewel of the nation's economy, has quickly become its rust belt, and things may just get worse

By Ben Blanchard  /  REUTERS , SHENYANG, CHINA

Chinese job hunters check computer screens for vacancies at Dalian Qixiuyu Employment Agency in the northeastern city of Dalian on May 28. Once the crown jewel of the centrally-planned economy, today the northeast is China's rust belt. It is rapidly becoming a source of labor for the rest of China. Leaders in Beijing, who value stability above all else, fear more job losses in the northeast could lead to wider social unrest, threatening a decade of breakneck national economic growth and even bringing into question the viability of the Chinese Communist Party itself.

PHOTO: REUTERS

Hopeless.

That's how Jacky Qu sums up his job prospects when he graduates next year from college in the frigid northeastern Chinese city of Shenyang.

"I've seen both my parents lose their jobs," the 22-year-old computer studies major said, nursing a beer in a pub where he sings part-time to earn extra cash. "There's no work up here. I'd rather go anywhere but Shenyang."

Qu's parents thought they would have jobs for life at state-run firms in China's old industrial heartland.

After Beijing launched economic reforms more than two decades ago, many lumbering state firms found they could no longer keep pace with their leaner cousins along the coast who were busy attracting foreign investment.

Jobs vanished at an alarming rate. Take aviation and auto giant Harbin Aviation Industry Group, a few hours from the Russian border.

The firm chopped three-quarters of its workforce over the past 20 years, though it still employs 27,000 people.

Communist Party leaders in Beijing, who value stability above all else, fear more job losses in the northeast could spread wider social unrest, threatening a decade of breakneck national economic growth and even the Chinese state itself.

Once the crown jewel of the centrally planned economy, the northeast is China's rust belt today. The countryside is littered with the hulks of factories, and trees are reclaiming the railway sidings that once ferried goods to the rest of the country.

Things may get worse.

"Our urban unemployment rate is officially 6 percent," said Zhang Wenyue, governor of Liaoning province, where Shenyang is located. "But the real figure is much higher. We have a responsibility to say what the actual situation is."

Western businessmen in Shenyang -- a gritty, crumbling city that was a Mongol trading centre in the 11th century -- cite government contacts as saying a more realistic jobless rate was 40 percent.

College students such as Qu will graduate into a tight labor market, with 2.5 times more graduates seeking work than in 2001, state media say. And further restructuring in the northeast has made work scarcer.

PROTESTS

The region's richest city, Dalian, wants to close or sell 33 major state-owned enterprises within two years, adding 100,000 to the dole queue, doubling the figure now.

Hence a recent history of unrest.

In March 2002, two of the country's largest demonstrations erupted in the northeast, a region lauded as an industrial utopia under Mao Zedong (毛澤東) but long since past its glory.

Worker demands for unpaid benefits at the oil fields of Daqing and protests in the flagging smelting town of Liaoyang and elsewhere forced Beijing to tackle the plight of the urban unemployed.

The province of Heilongjiang -- which makes up the rust belt, together with Liaoning and Jilin -- is expecting almost 2 million more people to be out of work in the next two years, up from about a million at the end of last year.

And that's just the official number. Many workers are classified not as unemployed but as "laid-off" -- they still receive a modicum of social security from old work units and perhaps a pittance in salary, but no longer go to work.

They are a common sight on street corners in the northeast, holding aloft wooden boards with roughly painted characters advertising their expertise, hoping for day jobs as laborers.

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