Chinese authorities have announced new plans to encourage college graduates to start businesses, following the education ministry's announcement that this year may be the hardest year for finding jobs as the number of graduates has reached a record high.
There are nearly 7.5 million university graduates this year, 220,000 more than last year.
Several government bodies have announced plans to counter the potential unemployment wave.
Education Minister Yuan Guiren said the government will encourage college graduates to join the service sector and modern agriculture industry, and guide them to second- and third-tier cities and work for private enterprises. The ministry will also improve the welfare of those who choose to work in grass-roots organizations.
Human Resources and Social Security Minister Yin Weimin said the government will expand business start-up subsidies to include those who are on student loans.
Xu Hongcai, assistant to the financial minister, also said college graduates who start up businesses would enjoy tax breaks while authorities will regulate financial support to entrepreneurs to ensure that it is used effectively.
Observers said the new policies show that the government has started moving away from a previous unbalanced development pattern to a more comprehensive one.
"In the past 20 years, China has been focusing on economic development while the education structure has been encouraging people to pursue high education qualifications and ignore entrepreneurship. As a result, a large number of graduates and postgraduates only want to work in first-tier cities for a high income, but have fewer job openings," said Yang Yansui, a professor of social security at Tsinghua University.
Yang said China is currently at its turning point, so such policies must be sustained in order to see its effect.
"The government should also provide support when graduates fail in their businesses so they will not be deterred from trying," she said, adding that guiding graduates to the right industries will benefit the country's talent pool as a whole.
The State Council announced earlier this month that graduate employment is the top priority.
