China’s Education System: Ready For the Future of Its Economy?

China’s education system has topped international rankings for the past decade, but it’s not at all clear that high test scores are translating into capable employees.  As China continues its journey up the economic value chain, the education system must also evolve in order to prepare a workforce capable of filling these new, more demanding jobs.

The rise of China’s top-ranked education system

China’s Education SystemChina’s modern education system is in many ways a by-product of the broader market economy reforms ushered in during the 1970s and 1980s.   Under Chairman Mao, educational reforms focused on achieving egalitarian goals, like eradicating academic elitism and bridging gaping social divides.   However, in the post-Mao era, education played a pivotal role in enabling China to achieve economic modernization.   Top priorities of the new system emphasized compulsory primary and secondary education, expanded post secondary opportunities, and preparation of the educated elite to execute the modernization program in the coming decades.  

As a result, today’s Chinese students receive nine years of compulsory education, including six years of primary school and three years of middle school.  The vast majority of those student continue on to high school, where their time is spent preparing for Gaokao — China’s national exams, which have served as the primary channel for getting ahead in Chinese society since the 10th century.  These exams are the gatekeeper for students seeking entrance to a Chinese university, and are seen as a critical determinant of a child’s long-term success.  

Gaokao has fundamentally shaped Chinese educational tactics for the past forty years.  Historically, these exams have tested students on a narrow set of core subjects and have served as the sole determinant in evaluating entrance to post-secondary institutions.  Schools (often under pressure from parents) have specialized in instructional methods geared to optimizing performance against these exams, focusing on top-down instruction and rote memorization versus critical thinking, practical application, and socio-emotional development.  

Consequently, Chinese students have become excellent test takers, capable of consistently outscoring their peers on international academic assessments like the Programme for International Student Assessment (PISA). These test results have caused many throughout the international community to consider the Chinese education system an exemplar, including former US Secretary of Education  Arne Duncan, who referred to the 2010 release of PISA results a “sputnik moment” for American educators.  

At the postsecondary level, results have been no less stunning.  In 1998, the Chinese government embarked on a sweeping initiative to expand university enrollment, resulting in China quadrupling its number of college grads within a decade.  Between 1999 and 2003 alone, enrollment in higher education increased from 1.6 million to 3.82 million.  By 2010, 6.3 million Chinese students graduated from College or University, with 63% entering the workforce.

These educational reforms at the primary, secondary, and postsecondary levels have created a top-ranked educational system respected throughout the world.  However, these extraordinary statistics belie growing evidence that students graduating from this system are not fully prepared to enter a fast-evolving and demanding workforce.

Trouble ahead: preparing great test-takers or rainmakers?

Although Shanghai and Hong Kong are consistently among the top performers on PISA, China’s educational system has been criticized for its emphasis on rote memorization and test preparation.  “The entire system is geared toward that one goal — taking [a] test,” said Yasheng Huang, a professor at the Massachusetts Institute of Technology.  

Critics contend that Chinese students are excellent test takers, but that didactic teaching and regimented exams have failed to produce young people who foster technological innovation or design breakthroughs. The Gaokao, in particular, has attracted criticism for driving the misalignment between educational methods and career outcomes.

Once at university, students face another set of challenges.  The rapid expansion of postsecondary education strained teaching resources throughout the 2000s; throughout this same period, many universities also became less responsive to the changing demands of the labor market.  As more and more graduates from second- and third-tier universities entered the labor market, they found that there was a large gap between the knowledge they acquired in school and the skills they needed to compete in China’s increasingly complex economy. In addition to growing unemployment rates among recent college grads, the average college graduate earns just 300 yuan — roughly $45 — more per month than the average migrant worker.  

Frustrated by the difficulty level of the exams and increasing reports of limited opportunities post-graduation, fewer students are even sitting for the national exam.  The number of students taking the Gaokao test has declined from its peak of 10.5 million in 2008 to 9.3 million in 2014.  Moreover, many Chinese parents are increasingly skeptical of hyperfocused Chinese undergraduate programs, and are instead choosing to send their children to undergraduate programs abroad which focus on more holistic training.  

China’s current educational system also reinforces class mobility barriers.  There is a gaping disparity between the educational opportunities afforded urban students versus their rural peers.  Simply put, students in urban schools attend nicer, better-staffed schools than their students in rural communities.  If children do migrate with their parents, the hukou system limits their opportunity, as rural children are denied the right to enter the urban schools in communities where their parents work.  In an economy that will be increasingly dependent on consumer spending in the coming decades, limiting mobility into the middle class will become a significant threat to future economic viability.

Implications for future growth

As China’s economy evolves from a manufacturing- to service-orientation, the demand for highly skilled workers is expected to rise at a faster pace.  Specifically, China will become increasingly reliant on value-added, knowledge-intensive manufacturing and modern service industries for future economic growth.  Rising wages have already enabled places like Vietnam and Cambodia to compete with China on lower-value manufacturing, putting pressure on China’s traditional secondary sectors.  Demographic trends are also putting pressure on the economy to evolve, as China’s “one child policy” is already creating an absolute decline in the number of workers available.  As China’s broader economy gears up for a major transition, the question remains as to whether or not China’s workforce can keep pace.

To date, many Chinese graduates have been ill-prepared for the job market.  In fact, a McKinsey study found that 44 percent of executives in Chinese companies reported that insufficient talent limited their global ambitions. Multinationals also find the labor pool lacking.  Despite China’s enormous and growing pool of university graduates, fewer than 10 percent of Chinese job candidates, on average, would be suitable for work in a foreign company.  In fact, McKinsey projects that China’s shortage of college-educated workers will reach 23 million by 2020, even though the number of college educated workers will rise by 50 million over the next decade.  

The implications could not be clearer: to remain competitive, China’s education system must refocus its goals from producing high test scores to fostering true career readiness.

Promising reforms and continued challenges

This message has not been lost on Chinese leadership.  In 2010, the government enacted a 10-year reform program to modernize China’s education system by loosening state control over education.  A key piece of this liberalization effort is the push to enrich Chinese national exams and nudge teachers away from rote instruction.  The ultimate aim in implementing these reforms is to nurture agile problem solvers equipped with the skills and acumen needed for the next era of Chinese growth

Specifically, China is in the process of reshaping its Gaokao exam to focus on a broader range of topics and cognitive skills and to transition away from teacher-dominated lecturing. The new test will require students to employ complex analytical skills, and demonstrate broader knowledge across various subjects.  In addition, college admissions protocols must now also consider a student’s volunteer service and performance in elective classes, thereby building greater emphasis for a student’s broader academic and social profile during the college application process.

In addition to the changes precipitated by Gaokao reforms, budding innovations in teaching and school model are also evident.  A handful of government schools, for example, now practice Western-style teaching strategies via “learning-oriented classrooms.” “Key schools,” similar to charter schools in the U.S., are also increasingly popular with recent teacher college graduates.  In these schools, educators possess an unprecedented freedom to determine how to teach their students.

These early reforms are encouraging, but tough questions remain.  How will China balance encouraging stronger individuality while retaining social control?  And how quickly can China’s large education apparatus shift to prepare its 211 million students for a rapidly changing economic future?

Brenna Benson
MBA Candidate 2016