The Ant Tribe

0013729e42ea0c87f4af27Is education really the key to a bright economic future? That may not be the case in China:

Reporting from Beijing – Six months after graduating from university, Guan Jian was unemployed and living in an 8-by-8-foot rented room on the fringes of this sprawling capital.

His quarters were so hastily built that the landlord didn’t bother to include a bathroom. When duty calls, Guan must trudge to the neighborhood toilet. Yet at $65 a month, it’s all he can afford. Money is so tight at times that he has learned to suppress his hunger with a single steamed bun a day.

This wasn’t how things were supposed to be for Guan, a 24-year-old broadcast journalism graduate who sports an easy smile and has a love affair with foreign film. A native of China’s northeastern Rust Belt and the first in his family to earn a college degree, Guan thought opportunities would come more easily.

Instead, he is one of an estimated 3 million jobless or underemployed college graduates in China, products of a mass social experiment by central planners to churn out more professionals for China’s economic development. Nicknamed the Ant Tribe, after the title of a recent book documenting their struggles, they now constitute a vast army of educated young people whose growing restlessness worries the Chinese government.

[…]

The ants’ story began a little over a decade ago, in 1999, when the Chinese government launched an ambitious plan to boost university enrollment by 30% annually. At the time, the country’s factories were suffering from the Asian financial crisis. Planners believed a rise in college rolls would help China transition from a largely export-driven, low-wage manufacturing economy to a more balanced one populated by upwardly mobile white-collar workers.

Undergraduate enrollment quintupled to 20 million students by 2008; last year 6.1 million Chinese earned diplomas, up from 1 million in 1999. But it soon became clear there weren’t enough suitable jobs for these freshly minted graduates. Beijing has slashed college enrollment growth to 5% annually.

College graduates have made investments in the form of time, energy, money, and foregone income in their educations. In China just as here they expect some return on that investment.

Unfortunately, just having a degree is no guarantee of such a return on investment. The economy doesn’t automatically create jobs suitable for the skills that newly-minted graduates have acquired. Rather it’s the other way around: if students view their educations as investments that gain returns in terms of future prospects in jobs and incomes, they’ve got to tailor their studies to the areas in which those returns are most likely.

FILED UNDER: General, ,
Dave Schuler
About Dave Schuler
Over the years Dave Schuler has worked as a martial arts instructor, a handyman, a musician, a cook, and a translator. He's owned his own company for the last thirty years and has a post-graduate degree in his field. He comes from a family of politicians, teachers, and vaudeville entertainers. All-in-all a pretty good preparation for blogging. He has contributed to OTB since November 2006 but mostly writes at his own blog, The Glittering Eye, which he started in March 2004.

Comments

  1. Michael Reynolds says:

    Disappointed, educated elites are dangerous. The Chinese regime will need to find a way to channel their anger, preferably against an outside scapegoat. I wonder who?

    This kind of thing is why the idea that’s taken hold, that China is inevitably going to rise to superpower status, is dubious or at least a long way from being demonstrated.

    This is a country with over 1.3 billion people and a GDP that is still no larger than Japan which has a population one tenth as large.

    For all our problems as a country I would infinitely rather be holding our cards than China’s.

  2. John Personna says:

    Hire him.

    (On are serious note, education and income always had a correlation component. At higher education levels that becomes more apparent.)

  3. Rick DeMent says:

    On are serious note, education and income always had a correlation component. At higher education levels that becomes more apparent.

    Yes, in the past that has always been true. However, it can only be true in an economy that has jobs to offer those with advanced degrees. if there are no jobs available it won’t matter what your degree is in.

  4. JKB says:

    if there are no jobs available it won’t matter what your degree is in.

    There are always jobs for those with the right degree. What is going to be hard to come by are jobs for those with vanity degrees, such as broadcast journalism, given the changes in the market. Many of the liberal arts types were absorbed by the financial scam industry or real estate, but are now back on the street. Back in the early 1970s, Ph.Ds in Astronomy were washing dishes because the space race hit a stopping point. Flexibility is key as well as adaptability. This will be in the US soon enough.

  5. John Burgess says:

    Disappointed, educated elites are dangerous.

    Amen! I’ve been thoroughly mystified by the way Arab governments keep pushing people through higher education when there are no jobs available outside of manual labor. They end up with highly educated, disaffected young people with no hope of getting jobs. Instead, they sit around coffee shops and mosques, bitching about the unfairness of life, spending the few bucks Mom can spare on their entertainment.

    Even specialized degrees are oversubscribed. Syria, for one, produces hundreds of MS in Refrigeration Engineering. How many jobs exist int he entire world for MSEs with that specialization?

  6. Anon says:

    They end up with highly educated, disaffected young people with no hope of getting jobs.

    So what is the problem in these Arab economies then? It sounds like it is not lack of skills.

  7. Gerry W. says:

    This is a country with over 1.3 billion people and a GDP that is still no larger than Japan which has a population one tenth as large.

    For all our problems as a country I would infinitely rather be holding our cards than China’s.

    This is interesting. It is 50-50 either way. This article says that China will likely surpass Japan this year and will reach the U.S. in some 20 years.

    http://www.chinadaily.com.cn/bizchina/2009-03/10/content_7558359.htm

    Every country stumbles. And we have seen Japan stumble. But over the years they have taken some of our jobs no matter where they stand in the world. Japan has taken most of our steel, electronics, and cars. On the cars, they are here only because the unions insisted that they build cars here.

    We have a lot of big government and we are in two wars. While a lot of this spending is necessary, it also creates a drag on our economy. We are trying to do too much in a world where there are new players. Our capitalism is old compared to China. China has 1.3 billion people and to their advantage it makes them 3 to 4 more times to create scientists and other intellectuals. They will have an advantage of enormous internal growth as the sky is the limit for them. They are building whole cities. Their economic growth is at 8% and we will barely average 3%. They have surpluses and not debt.They have also taken more of our jobs. And when it comes to jobs, cheap labor trumps all. In fact, there is not enough jobs to go around with some 2 billion people looking for jobs. And since we have enjoyed a middle class for so long with good pay and benefits, we are seeing the results of cheap labor. We are seeing and have been seeing for some time that we are losing more of the middle class.

    China’s growth means more use of resources like oil and other commodities. And that will either drive commodity prices up or more in scarcities. It must be exciting to see a country grow like this, whereas in my community we see the loss of jobs. I have a friend in China and I don’t think he wants to come home. Why come home in the middle of a corn field when all the excitement is in China.

    As I said before, our growth is slower, we have high debt, we get paid too much, we are doing too much for what we want to do. Even if you open a business here, you are only taking business from someone else, and for the employees, there is no other place to go to. In China, whole cities can be built along with high speed rail, bridges, and highways. It is an exciting time to be in China.

  8. Michael Reynolds says:

    Gerry:

    All that’s true but it rests on the assumption that China will remain politically stable. We have two centuries of living under one constitution, of extending full rights to an ever wider circle, of remaining essentially united despite various challenges.

    Just a century ago China was being carved up by the great powers. They followed with a period of hot war, followed that with a bloody revolution. Now an elite is trying to bridge the gulf between communism and capitalism without democracy. Maybe that will work, but maybe not.

    Of course Japan in that same century has endured its own set of horrors, so maybe China will be a really large Japan or Korea. But it could just easily end up being a really large Russia.

  9. John Burgess says:

    Anon: A lack of jobs. Cronyism and wasta take the better jobs–connections over qualification–and the general economies are not generally sound: too much subsidization, to much central planning.

    Nobody much wants to work on the farms or dig ditches, though both are necessary. They’d rather have a title that used to mean something (mohendis, ustaz) than actually break a sweat.

  10. TangoMan says:

    On are serious note, education and income always had a correlation component.

    This is because the observed and measured independent variable, education, is really a very rough proxy for another variable, intelligence. There have been a number of interesting studies on this issue – one that comes to mind compared high school class rank across generations, where earlier generations had a much lower level of college attendance compared to later generations, and they found that the income variability more closely followed class rank rather than level of education. IOW, where only the top 10% (just for example) of high school students used to go to college in 1948, by 1978 the top 35% went to college, and by 2008 the top 60% go to college.

    The error in these education – income studies is that the mistakenly assumed that the income gains observed in the early cohorts of students were a result of the value added by education, and therefore, the same results could be delivered to students further down the class rank ladder if only they too were the beneficiaries of longer periods of schooling.

    For students of history, it should come as no surprise that the Chinese COMMUNISTS fell for this world view. It’s too bad that the wreckage to individual lives will be so costly, in China and around the world.

  11. john personna says:

    On are serious note, education and income always had a correlation component.

    This is because the observed and measured independent variable, education, is really a very rough proxy for another variable, intelligence.

    That or work ethic, or as someone else said, adaptability. Lots of things might lead someone to succeed in school and business, as opposed to business because of school.

    There is a lot of promise in having 6 billion human brains networked and learning … but that doesn’t really imply that we therefore need 1 billion engineers. Quite the opposite. With the networking, 1 engineer serves more than was possible ever before.

  12. john personna says:

    As an aside, there are some loons who attempt to measure “innovation” as “patent filings per capita.” Never mind that patents are half-stupid, and per-capita is pointless.

  13. TangoMan says:

    There is a lot of promise in having 6 billion human brains networked and learning

    I don’t doubt this for a moment, but the question that underlies such a reality is the opportunity cost of achieving such a state. As Dave notes in his post, there was significant financial and human investment made to achieve such an educational state and individual opportunities and enrichment were lost in order to focus on this goal. My point is that planners were pushing a new variant of the New Soviet Man and that the statistics used to buttress their argument didn’t really demonstrate what they thought, namely that education lifts incomes.

  14. Michael Reynolds says:

    I’m waiting with bated breath to see how Tango maneuvers this thread onto the subject of race and the problem of the untermenschen.

  15. john personna says:

    We’ll reach “6 billion human brains networked and learning” without effort. It’s just a question of how many of those brains self-educate about the Kardashians, and how many choose electrical engineering.

  16. DL says:

    Thanks. What great journalism -another piece of proof that the media of choice has entered a new paradigm.