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Since 1999, the expansion of higher education has been viewed as an important step in accumulating human capital for China that was to gradually open its domestic sectors to the global market at a turbulent time at the turn of the century. Recent studies suggest that the improvement of human capital has succeeded in preparing China with a solid platform to weather the economic crisis in recent years. However, these changes have not necessarily favoured the disadvantaged groups or promoted social mobility. This article demonstrates that access to elite universities of prestigious status is not equal for students from different socio-economic backgrounds. An analysis of graduates' starting salaries shows that educational inequality has contributed to income inequality, which is one of the key obstacles to building a harmonious society. Inequality of opportunity in higher education occurred in the context of marketization and localization of higher education, which have been worsening the regional disparity of human capital investment. This article examines the pros and cons of the policy changes, and attempts to draw lessons from the structural problems lingering from the past policies which China has to address in the aftermath of the current economic crisis.

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Since 2003, Chinese university students have faced a dangerous level of unemployment after graduation. Current trends indicate that the situation is likely to remain at this level for some time. This article argues that it is difficult to generalize that there has been a decline in the competitiveness of all university students in the job market and that they all face serious employment difficulties, because there is a rather significant difference in competitiveness among graduates from different types of institutions. Exploring the issue by applying human capital theory and screening theory in analyzing statistical data on the employment of university graduates, this research suggests that the most competitive graduates are likely to be those from economically developed areas who are studying at elite institutions. For university graduates, the ability to find a job does not necessarily mean being competitive. Taking into account the inequities in the education system overall, most students getting into these elite schools come from families with higher social class backgrounds, indicating an important relationship between competitiveness and various ascribed factors. This article argues that, when comparing the competitiveness of Chinese university students with that of their peers from other regions of the world, one cannot ignore social backgrounds.

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