Govt to grant loans to aid graduate start-ups

Small businesses and college graduate start-ups are set to be the next engine to drive employment and the slowing economy, the State Council announced Wednesday. The cabinet pledged to roll out a series of supporting policies as soon as next week to achieve the goal of 800,000 fresh entrepreneurs in the four years to 2017.

Developing entrepreneurs has become the focus in boosting employment in China since the 18th National Congress of the Communist Party of China, Xin Changxing, vice minister of the Ministry of Human Resources and Social Security under the State Council said at a press conference on Wednesday.

Seven million college graduates entered the job market in 2013. This number has exceeded the capacity of China's current economic structure and caused the market mismatch, Dong Keyong, an expert in human resources at the Renmin University of China, told the Global Times.

Xin expressed his wish to see more young Chinese entrepreneurs.

"The percentage of graduate entrepreneurs in China is far behind other countries," Xin told the Global Times on Wednesday.

"We don't limit the types of business and will provide equal support to start-ups of all kinds, from small technology firms to local noodle restaurants," Xin said.

Xin admitted the small and micro-businesses will not create as many job openings as big corporations, but assured their importance in achieving a "multiplying effect" in the job market.

"Not only can the entrepreneurs create jobs for themselves, they can also create job opportunities for their fellow counterparts as they recruit employees for their start-ups," Xin noted, "The numbers are huge when we add up all of these small businesses."

Graduate entrepreneurs will be given small-sum guaranteed loans or subsidies to open small- and micro-businesses. The government will provide vocational skill-based training, but graduates will still need to bear the risk of such investment themselves, Xin noted.

College graduate unemployment is only "a short-term trouble" during the economic restructuring, Xin said.

The job market still needs talented people with higher education to prepare for the new phase of economic development, he said.

Unemployment among fresh graduates is in fact not as serious as media reports indicate, Dong said. The real problem is they cannot find jobs that match their career goals.

Among the graduates in 2013, one percent of them or 70,000 people turned to entrepreneurship upon graduation. The government's goal is to reach 200,000 per year until 2017. However, this will only be a supporting policy, as the goal is hard to achieve, said Dong. He added that lack of capital will be the biggest hindrance holding young entrepreneurs back.