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College Enrolment Expansion policies have been implemented in China since 1999. Unfortunately, numbers of qualified teachers and the amount of educational funds input have not caught up with the pace of student intake. Even the curricula taught in colleges are outdated and work practice programmes are inefficient. As a result, new college graduates cannot meet the requirements of firms they wish to work for. Many graduates work in unskilled job positions with low pay. They are called the "Ant tribe." We estimate that the accumulative number of persons in "Ant tribes" had exceeded 3 million by 2010, and the corresponding cost to China's annual GDP was over 0.22% in respect of effective labour input. Improvement in quality should take priority during the expansion of higher education.

China's dramatic economic growth during the past three decades has been characterized by rapid industrialization fueled by a large pool of rural surplus labor in the agricultural sector. The large-scale movement of workers from the agricultural to the industrial and service sectors raises pertinent questions about sustainability: Is there still a pool of surplus workers in rural China? If there is, how large is it, and how long can it last? These questions are debated in China. The present study contributes to the discussion by providing a quantitative framework with which to estimate the size of the surplus labor pool under various scenarios. Applying a dynamic general equilibrium model of the Chinese economy, we present our estimates of the size of the rural labor surplus from 1997 to 2005 and forecast its size from 2006 to 2015. Two scenarios are presented: one is business-as-usual, the other an accelerated improvement of labor productivity in China's agricultural sector. [ABSTRACT FROM AUTHOR]