China's youth unemployment rate remained steady in March, in what could be seen by some as a tentative sign that the world's second-largest economy is gradually stabilizing.

The jobless rate among China's 16- to 24-year-olds--excluding those enrolled in school--stayed at 15.3% last month, the same as in February, according to data from the National Bureau of Statistics on Thursday. That is broadly in line with figures earlier this week showing that overall headline unemployment stood at 5.2% in March, ticking down from the prior month's 5.3%.

The jobs numbers come after China surprised markets with strong growth in the first quarter of the year as Beijing doubled down on its manufacturing drive. Despite the upbeat figure, economists warn that it's not the time for complacency as wider activity data for March pointed to tepid consumer demand and continued distress in the property sector. A high rate of youth unemployment could exacerbate concerns about weak household spending, while Thursday's data will likely also be taken with a pinch of salt after changes to how the rate is calculated make it harder to interpret.

China's statistics bureau suspended the release of the youth jobless rate in June last year after the figure climbed for six straight months to a record high of 21.3%. It resumed releasing the series in January this year with a new methodology that excludes young people who are still studying. That exclusion is unusual compared to how other nations, including the U.S. and European countries report employment figures, treating full-time students much the same as long as they have been looking for jobs.

Excluding students in school, unemployment among China's 25- to 29-year-olds rose to 7.2% in March from February's 6.4%, while that among the 30- to 59-year-old age group declined to 4.1% from 4.2% over the period, according to the official data.

The uptick in youth unemployment from January is concerning, according to Erica Tay, economist at Maybank. January's rate clocked in at 14.6%, meaning unemployment among 16- to 24-year-olds was up by 0.7 percentage points in February and March.

That's especially worrying "given efforts by the authorities to spur more job creation for youths since late last year," said Tay. "The fragile job market may continue to lead to cautious consumer spending."

Beijing's policy drive to double down on advanced manufacturing will likely create only a limited number of highly-skilled jobs, she told Dow Jones Newswires. "To absorb large numbers of graduates, the services sector needs to grow rapidly," Tay said. However, in the first quarter, services-sector growth has slowed discernibly.

Online job postings remain weak overall but encouragingly, postings in manufacturing seem to have bottomed out, and are gradually recovering in April, the economist added.

"Manufacturers will likely wait to see if the industrial upturn is here to stay, before ramping up their hiring further," Tay expects.

The tweaked metrics on youth unemployment is one of several moves taken by Chinese authorities in recent years that have made it increasingly difficult for outside watchers to gauge the health of the economic powerhouse.

Last week, China's two main stock exchanges said they plan to stop displaying real-time data for cash flows into the county's stock market via Hong Kong, a move that would eliminate a closely-watched indicator of foreign sentiment toward Chinese equities.

The Shanghai and Shenzhen bourses said the move will take effect in about a month, adding that turnover details will be published daily after market close.


--Fabiana Negrin Ochoa contributed to this report


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(END) Dow Jones Newswires

04-18-24 0325ET