The number of applicants for next month's national postgraduate entrance examination has dropped to 3.88 million, a decrease of 500,000 compared to the previous year, according to the Ministry of Education. This marks the second consecutive year of decline after nearly a decade of rapid growth.

Applications peaked at 4.74 million last year, but the admission rate was just 24.2 percent. Despite fewer applicants, admission requirements have remained stringent, with rising qualification thresholds in disciplines such as philosophy, law, literature and management.

Xiong Bingqi, director of the 21st Century Education Research Institute, attributes the decline to the diminishing cost-effectiveness of pursuing higher academic credentials.

"Postgraduate degrees no longer guarantee better job prospects compared to undergraduate degrees. The devaluation of graduate degrees and the prevalence of underemployment among those with advanced degrees have made students realize that building core employability skills is more critical than merely acquiring a diploma," Xiong said. While credential competition persists, its appeal is waning, he added.

Chen Zhiwen, a member of the Chinese Society of Educational Development Strategy, echoed this sentiment, emphasizing that the diminishing returns of postgraduate education are a significant factor in the declining applicant numbers.

"For some students, spending three or more years obtaining a master's degree is less cost-effective than gaining work experience right after graduation," Chen said.

He also noted that the higher-quality training requirements for graduate programs have delayed the graduation of some students, deterring those who hoped to earn a diploma with minimal effort.

The economic burden of postgraduate education is another concern for students. In recent years, graduate education in China has expanded significantly, with an increasing proportion of admissions allocated to professional master's programs.

According to the Ministry of Education, professional programs, which focus on practical skills, are expected to account for two-thirds of total master's admissions by 2025.However, the tuition fees for these programs are rising.

For example, Shanghai Jiao Tong University plans to charge 160,000 yuan ($22,080) for its industrial design engineering graduate program in 2025. Similarly, the finance program at Shanghai University of Finance and Economics costs 228,000 yuan, according to their official websites.

In addition, many universities no longer provide on-campus housing for professional master's students, forcing them to bear the extra cost of accommodations outside the university.

This diminishing return has led more students to pursue alternative career paths, such as taking civil service exams or seeking positions in public institutions that offer greater job security. Applications for China's civil service exam for 2025 reached a record high of 3.42 million, with an average of 86 applicants competing for each available position, according to China Central Television.

A survey by China Youth Daily found that nearly half of the students consider delaying graduation to explore additional opportunities. Others are opting for entrepreneurship, freelancing, or entering the workforce directly before pursuing further education.

Fan Xiudi, director of the Education Evaluation Research Center at Tongji University in Shanghai, said the decline in postgraduate exam applicants could persist in the coming years and represents a positive development.

"It signals a shift toward more purposeful postgraduate education, where individuals pursue advanced degrees based on clear career goals rather than as a reluctant or blind choice after undergraduate studies," Fan said.

She predicted that more people would choose to pursue higher studies after working for a few years and clarifying their personal development goals.

This trend, she added, will pressure universities to reform graduate education, making programs more adaptable to the needs of individuals at different life stages.

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