For decades, many young Chinese believed that hard work, strong grades, and a university degree would unlock a better future. But as China’s economy slows and political control tightens, a growing number of graduates are discovering that academic merit is no longer enough. Instead, family connections — especially ties to the state system — often determine who rises and who is left behind.
When the top student falls behind
Liu Ao enrolled at North China University of Technology in 2018 and now lives in the United States. He recalls that in his university dormitory, the most diligent student, once admired for his academic discipline, is now struggling the most.
The classmate, from a modest family in Guizhou Province, hoped to build a career in Beijing after graduation. But without influential relatives to help him, he was forced to return home. Today, he earns roughly 3,000-4,000 yuan (about US$420-$560) a month by selling mobile SIM cards for China Unicom.
His story reflects a larger shift. In the 2010s, China’s booming tech and private-sector industries offered upward mobility for talented students from ordinary backgrounds. But a combination of a prolonged economic slowdown, real estate debt crises, and sweeping regulatory crackdowns has reshaped the job market. The private sector shrank, while stable and respected career paths increasingly clustered within state-owned enterprises and government-linked institutions.
A return to the system
Liu observed that many classmates who once dreamed of exploring creative fields or starting businesses eventually returned to industries dominated by state control — especially the petroleum sector, where his extended family works.
“In middle school, many of us said we never wanted to work in the same system as our parents,” he said. “We had our own dreams. Some wanted to do art, others business.”
But reality changed those ambitions. Friends who once sought opportunities elsewhere found little success. “They all failed, and their thinking changed,” Liu explained. “After seeing how society works, they accepted their parents’ arrangements and returned to the oil system.”
Even then, entry was no longer guaranteed. During the 2000s, petroleum companies actively recruited university graduates. By the time Liu reached college, getting hired had become extremely competitive. Some graduates accepted grueling field jobs near oil wells without official employment status, performing heavy labor while waiting — sometimes for years — for a formal spot to open.
Salaries in such positions are modest, especially after deductions for insurance and housing funds. Yet many still cling to them for one reason: long-term security. Liu pointed to an uncle who retired from a government unit after four decades and now receives more than 10,000 yuan (over US$1,400) per month in pension.
“Suddenly, I started to envy the older generation who didn’t go to college,” he admitted. “In their time, the state assigned work. They didn’t get to choose their careers, but at least they had steady jobs, housing, and a future they could rely on. Our generation studies harder, fights harder, and yet graduates into instability. It feels like we lost both freedom and security in the process.”
The rise of ‘token hiring’ and exclusion
This challenge extends far beyond oil companies. Zhou Heng, formerly an engineering manager in Changsha, explained that nearly every desirable position in China is now occupied by officials’ relatives or their extended networks.
Many job postings, he said, are merely for show. “Even if you score first on the written exam, they will find a reason to eliminate you in the interview,” he recalled. Qualified candidates without connections are often used as “window dressing” to create an appearance of fairness.
Zhou describes the system as one of “mutual support” among privileged families, particularly in smaller cities. If one parent works in the Tobacco Bureau and another in the Power Bureau, each helps the other’s child secure a role. Over time, this creates a closed circle that monopolizes the most stable and desirable jobs.
Children of ordinary families rarely break in — unless they are exceptionally gifted. And even then, Zhou said, “they often end up doing the hardest work with no path to advance.”
Guanxi and generational advantage
This network of favors, known as guanxi (关系), has always played a role in China’s employment landscape. But as economic opportunities narrow, its influence has intensified. While networking is common worldwide, China’s state-dominated system gives elite family connections unusual power. Rather than supplementing formal hiring, guanxi often overrides it.
For millions of young graduates, this dynamic creates deep frustration. China produced more than 11.5 million university graduates in 2023 — an all-time high — while youth unemployment soared. Many graduates now find themselves competing fiercely for lower-paying work, questioning the value of their degrees.
A generation questioning the promise of education
The stories shared by Liu and Zhou highlight a growing sense of disillusionment among young Chinese professionals. For many, the pathway to success has narrowed, and upward mobility has become less about personal merit and more about political ties, family background, and inherited privilege.
As Liu reflected: “Even if you get a master’s degree, it doesn’t change anything. It’s painful.”
In a society once energized by rapid growth and possibility, this quiet despair tells a larger story — one of hopes deferred, dreams reshaped, and a generation forced to confront a reality where education and effort are no longer guaranteed paths to a better life.
See Part 1 here
Translated by Audrey Wang
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