In Depth: China’s New Graduates Get Hired, Then Cut Loose - Caixin Global

In 2025, Xu Shan, a senior majoring in product design at a college in East China’s Anhui province, joined the fall campus-recruiting drive at his school. After applying and completing three rounds of interviews, he received an offer to become an industrial designer at Marssenger, a leading kitchen-appliance maker in Jiaxing, Zhejiang province.
“The offer paid 8,000 yuan ($1,194) a month and included meals and housing,” Xu said. “Compared with other entry-level jobs in the industry, it was pretty good.”
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1. [para. 1][para. 2][para. 3][para. 4][para. 5][para. 6] Xu Shan, a product design senior at a college in Anhui province, obtained an industrial designer position at Marssenger, a leading kitchen-appliance maker in Jiaxing, during fall 2025 campus recruiting. The offer paid 8,000 yuan ($1,194) monthly plus meals and housing. The company pressed him to sign within three days or lose the role and required a 5,000 yuan penalty if he backed out. Xu signed a standard tripartite employment agreement with a July 7 start date. Two weeks before starting, Marssenger rescinded the offer; it paid the contractual penalty, but Xu felt angry and helpless at losing his first job before it began.
2. [para. 8][para. 9][para. 10] Xu had sensed trouble as the company's share price kept falling. By Sept. 16, Marssenger's shares were down over 13% for the year; its Aug. 28 interim report showed first-half 2026 revenue fell 27.6% year-on-year to 271 million yuan, with a net loss attributable to shareholders of 130 million yuan. The company blamed the continuing downturn in China's property market and slow recovery in consumer confidence.
3. [para. 11][para. 12][para. 13][para. 14][para. 15] Zhang Lu, a class of 2024 graduate dismissed from a Tianjin pharmaceutical company, recalled how roughly 20 to 30 new graduates were taken into a conference room in small groups and individually told they had "not passed the assessment" as her probationary period ended. There was no scorecard or specific feedback; instead, the company pressured them to sign separation agreements quickly, hinting that refusing could hurt future job searches. The company continued campus recruiting after they left.
4. [para. 17][para. 18][para. 19] Several factors underlie such layoffs. Some businesses hire aggressively on optimistic projections, then cut the newest recruits when demand weakens and budgets tighten. Others adopt a "hire first, cut later" strategy, exploiting the plentiful graduate supply to identify candidates offering better value and cultural fit. Lawyer Huang Yi noted that some non-compliant employers hire large cohorts, pit graduates against one another, and dismiss most shortly before probation ends on various pretexts.
5. [para. 20][para. 21] The practice is especially pronounced in manufacturing, driven by seasonal labor demand fluctuations and reluctance to maintain large long-term workforces with fixed costs. In lower- and mid-level manufacturing, where margins are thin and businesses often operate near break-even, there is little room for risk.
6. [para. 24][para. 25][para. 26] After his offer was rescinded, Xu quickly moved to Shanghai, found part-time work, and continued job hunting. He found it far harder to land roles at listed companies comparable to Marssenger and turned to smaller startups, eventually joining a robotics startup in Suzhou that provided housing and paid more. Still, he could not relax: the startup's management systems and work processes were incomplete, and his hope of using a large platform as a career springboard had collapsed.
7. [para. 27][para. 28] Rapid technological change compounds the challenge; AI applications are replacing many junior positions, removing the first rung of the career ladder for new graduates. Many of Xu's product-design classmates have shifted to operations jobs with lower entry barriers.
8. [para. 30][para. 31][para. 32][para. 33] Dismissals during probation have become a frequent source of disputes. Lawyer Bai Yufei said the most commonly cited legal basis is that an employee failed to meet hiring requirements; if the employer can prove this, termination without severance is lawful. However, under China's Labor Contract Law, each graduate's employment relationship is independent and cannot be terminated at will. Employers must prove the requirements were clearly communicated in advance and specify how the employee failed them; otherwise, the dismissal is unlawful.
9. [para. 34][para. 35] Xu received his first paycheck from his new job on Aug. 26—one day later than expected—leaving him deeply uneasy. Still sending out resumes, he hopes to find something more stable. (Xu Shan is a pseudonym.)
Sep. 25, 2026, Issue 37
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