Entreprenurial dilemma: Grads in China not taking the plunge

Entreprenurial dilemma: Grads in China not taking the plunge
Chinese entrepreneur LiDong runs his own coal business.

He jumped through hoops to land a cushy job at a state-owned enterprise, but Mr Li Dong, 26, gave it up in 2010 to pursue his dream of becoming his own boss.

With capital of 60,000 yuan (S$12,200) - half from his savings and the other half borrowed from friends - the Inner Mongolia native started a business providing services and support to coal mining operations in the northern region after a year at a government-linked insurance firm that paid him 60,000 to 70,000 yuan yearly.

"It's competitive in government jobs too. If I put that hard work into my own firm, I can achieve more. It's a gamble, tougher, but hopefully I'll get more out of it," he told The Straits Times.

His entrepreneurial spirit is, however, increasingly rare among China's university graduates these days.

While they were once gutsy risk-takers who plunged into the business world as China's economy boomed over the past 30 years, many of China's young today are flocking to jobs in the public sector, lured by a higher social status, stable income and better welfare benefits.

Education research firm MyCos found in a June survey that only 2 per cent of Chinese university graduates had plans to start a business. The high failure rate - 70 per cent of those who took the plunge saw their business fold within three years - might be part of the cause.

The problem of declining entrepreneurial spirit among graduates has captured the attention of even China's Premier Li Keqiang and its richest man, Mr Wang Jianlin.

During a visit to the Lanzhou University in Gansu province in August, Mr Li urged graduating students, who are facing an "unprecedented challenge" in finding jobs due to the record seven million graduates this year, to start their own businesses as he pledged government help.

Mr Wang of the Dalian Wanda conglomerate lamented in a recent interview how a fund set up by him and other businessmen to support young entrepreneurs has struggled to disburse its money due to a lack of candidates.

"China's biggest problem is that there is much more emphasis on government officials rather than entrepreneurs," he said.

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