Growing pains: higher education expansion and graduate employment in China

Higher education expansion has fundamentally changed the access to, quality and costs of tertiary education, yet its dynamic impacts on graduate employment and social mobility have received little scholarly attention. This chapter utilizes rich information from China’s national surveys of higher education graduates from 2003 to 2019 to explore the changing effects of higher education credentials on job sorting. It illustrates how the expansion has led to labour market structural changes and weakened ties between higher education credentials and quality jobs. Regression results indicate that the tertiary expansion has contributed to cohort crowding and impaired the signalling role of higher education credentials over the past 20 years, as recent graduates are more likely to be sorted into positions in the informal and non-urban sector. The chapter argues for a more critical reflection on the merit of the accelerated massification of higher education in developing economies regarding its potential impacts on intergenerational inequality.