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China / Education

Graduates reluctant to start a business

By SU ZHOU/ZHENG JINRAN (China Daily) Updated: 2016-05-23 11:38

Three-fourths plan to get a job, with 30 percent of them aiming for good-paying internet industry

Graduates reluctant to start a business

Graduates from normal universities in Hunan province interact with their potential employers at a job fair in Hengyang in March. More than 4,000 graduates participated in the event.[Peng Bin/For China Daily]

Given a choice, Chinese university graduates prefer to find employment rather than start a company.

A report by human resources website Zhaopin released recently found that only 3.1 percent of students expecting to graduate in July said they will start their own business, down from 6.3 percent in 2015.

"The Chinese government, universities and investors have provided a friendly environment for young startups. However, the failure rate of fresh graduates founding startups is still too high due to the lack of experience, resources and networking," said Wang Yixin, a senior consultant at Zhaopin.

"In addition, universities have paid a lot of attention to cultivating innovation instead of starting up companies. This is another reason for the low desire on campus to found startups."

At the same time, college graduates' interest in further education has also dwindled, leading to an increase in students wanting employment from 71.2 percent last year to 75.6 percent this year. Nearly 30 percent of those graduates accepted offers from the internet industry, which is among the highest paying.

Zhang Jingxiu, executive director of Beijing-based employment consultancy Newjincin Research Institute, said he didn't monitor the significant decrease of students' willingness to start businesses, but he does admit the desire to found startups among students on campus is low.

"Students are not suited for starting businesses on their own," said Zhang, adding that vocational students are more eager to start businesses than university undergraduates.

"According to our survey last year, only 0.6 to 0.7 percent of students at universities were thinking about starting their own companies. The number among vocational school students was as high as 2.2 percent."

"However, the idea of vocational students starting businesses is related more to creating jobs for themselves, and the majority of them have chosen to have online shops."

In the past 12 months, more than 20 provinces have introduced policies to encourage students to start their own companies by allowing them to quit studying but keep their student status for two to eight years. However, many industry insiders insist that students complete their studies and work a few years first.

Chen Yu, vice-president of the China Association for Employment Promotion, said a startup may be meaningful, but one should not expect too much from it.

"Some geniuses in the internet industry created miracles, but that does not tell the whole story," said Chen. "Business has its own rules. Before you start up, you have to know how to produce products, how to sell them, how to manage a company. Those lessons you cannot expect a fresh graduate to know."

Yang Qiuping, general manager of Fudan Software Park, suggested that students finish their studies first, especially those from rural areas.

"Students can start after graduation, but it is not urgent," said Yang. "In China, I think a diploma still matters."

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