Du Xin spent the last week of 2005 busier than most.

The 23-year-old graduate from a university in Northeast China came to Shanghai, one of China's economic powerhouses, to attend four jobs fairs, hand out 15 applications and send 24 e-mails to prospective employees over the course of seven days. Unfortunately, all of his efforts were in vain.

His predicament is mirrored by graduates across the country.

Once destined to have a good job, college students are now under growing employment pressure. In 2005, 3.38 million students graduated from colleges and universities, a 20 per cent increase from 2004, while education authorities estimate there will be 4 million college graduates this year.

"I came to Shanghai to try my fortune," Du said. "College graduates are under severe employment pressure this year. It will be more possible for me to win a lottery than to get a satisfactory job."

He faces even stiffer competition over the next 12 months.

Those who will seek jobs in 2006 also include 2.7 million graduates from secondary vocational schools, 2.1 million graduates from middle and high schools, 700,000 ex-servicemen, 2.6 million former rural residents who now have urban registered permanent residences, 1 million laid-off workers from State-owned enterprises and 8.4 million registered unemployed people.

The pressure of employment, especially for youngsters, is unlikely to decrease in the coming five years, said Mo Rong, deputy director of the Institute of Labour Science of the Ministry of Labour and Social Security.

Governments at various levels are playing a more active role in promoting employment to try to solve the problem. According to the Ministry of Labour and Social Security, China will create 9 million jobs in 2006 and resettle 5 million unemployed laid-off workers, aiming to confine the registered unemployment rate in urban areas to 4.6 per cent.

Tens of thousands of people, many of whom are relatively old, lack skills and live in abject poverty, have been employed in major cities such as Beijing and Shanghai, thanks to jobs created by the government indirectly.

Among those is laid-off worker Huang Zhenhua, 48, who has been employed as a public security patrol officer, which was organized by his neighbourhood in Shanghai.

China has tried to diversify education programmes, after it realized many college graduates were not welcomed by employers as they were trained in the same manner. Premier Wen Jiabao announced in November that the country would invest 10 billion yuan (US$1.23 billion) in developing vocational education, aiming to train more skilled workers for the upgrading of industries.

"Employment is a matter of great importance that concerns social stability, economic and social sustainable development," said Li Jian of the Shanghai Academy of Social Sciences.

A large labour force makes China competitive in labour costs and attracts foreign investment. However, it also enables entrepreneurs to confine workers' salaries to a low level, leading to further economic polarization, he said.

Everyday people's wages have not grown in accordance with the development of national revenue, so only few people can afford new technologies and products.

"Without enough consumption ability and demand, most of the 1.3 billion Chinese will only be potential consumers. A lack of market demand will make it difficult to implement China's independent innovation strategy," Li said.

Editor: Wing