Tess Vigeland: Today is the first day of China's national entrance examination -- known in Chinese as the "gao kao." Millions of Chinese high school graduates will spend three nerve-wracking days taking a test that will pretty much decide the rest of their lives. But is China's test-obsessed culture producing the innovators it needs to compete in the 21st century economy?
Marketplace's Rob Schmitz has the first in a series of stories on China's education crisis.
Rob Schmitz: Eighteen-year-old Wan Chao is memorizing a lot of things these days, but as he sits in his bedroom overlooking the busy Shanghai expressway on this cool evening in March, the number 87 is on his mind.
Wan Chao: In exactly 87 days, I take the gao kao. Ever since the beginning of senior year, I've felt anxious and scared, all because of this test.
Wan's score on this test will help determine the university he attends, what he studies, his career, where he'll meet a potential spouse, and how much money he'll make. And that's why Wan spends nearly every waking hour studying.
Chao: Careful. Careless. Cargo.
He studies English by repeating words from a dictionary, sometimes spelling them out loud. The same memorization exercise is performed daily at high schools throughout China.
Gao Xueming: Funerals.
Students: Funerals. Funerals.
At a high school in Shanghai, English teacher Gao Xueming is preparing her students for an upcoming quiz. Teacher Gao admits the exercise is about as much fun as a funeral, but it's the most efficient way to prepare for the gao kao.
Xueming: Because students should take the national examination, so correctness is very important.
Taking exams has been the way to get ahead in China since the 7th century AD. Back then, mastering the Confucian classics was the ticket to a job in the imperial bureaucracy. Today, 15-year-olds here in Shanghai overwhelmingly beat out their peers throughout the world last year in the Program for International Student Assessment, an International standardized test. American 15-year-olds ranked 17th.
Wang Jianding: This test proved that our students from Shanghai are the world's best students in reading, science, and math.
Wang Jianding is the principal of Xinzhuang High School in Shanghai.
Jianding: I think there are several factors contributing to our students' success: First, Chinese society traditionally values education. Secondly, the Chinese government has ensured a solid education system as the foundation of rapid economic development.
But is acing a standardized test the key to an innovative economy?
Shaun Rein: The education system and its inability to train analytical students is the biggest crisis facing China today.
Shaun Rein is the managing director of China Market Research, a market intelligence firm based in Shanghai. He says after studying for tests for most of their lives, Chinese graduates are programmed to memorize correct answers instead of performing the more complex task of working out a solution themselves. Rein's firm recruits analysts from China's top universities. He's found they're very good at researching data.
Rein: But they can't take it to the next level. And when they try to develop a strategy, or synthesize the information, they tend to just copy something that they saw being done elsewhere in the market, so they say, "Oh that company did this, let's do the exact same thing." Rather than saying, "This is what the trends are, this is what the competition has done, this is where we think you need to be in order to really grow well in China."
Rein says another problem is these 20-somethings -- "little emperors" from the one-child generation -- are still at home and spoiled.
Rein: Their parents went through the horrors of the Cultural Revolution, and don't want their kids to have any difficult times, so they're enablers. They tell their kids, "Oh don't work late!" If you run into a tough situation, go work at a state-owned enterprise, it'll be easier there.
Rein's firm recently interviewed Fortune 500 companies in China. It found that most of them have an annual turnover rate of around 30 percent. In the U.S., 11 percent is considered high. Rein says most Chinese graduates are not qualified for a global business system. He predicts this will soon start to wear on China's economy. He says multinationals, frustrated with Chinese employees, may start to hire more foreigners or they'll relocate operations somewhere else.
Chao: Cat. C-a-t. Cartoon. C-a-r-t-o-o-n.
But none of this matters to student Wan Chao, trying to memorize an English dictionary in his Shanghai bedroom. In the next room, his mom and dad bicker about their son's study habits.
Chao's mother: The problem is he doesn't want to understand his mistakes. He doesn't ask questions. I said it's OK if you make mistakes, but you need to figure out why you make mistakes. I've told him: If you fail the gao kao, I won't do anything for you. You have to feed yourself and wash your own socks.
Chao's father: Stop talking. What's the point of talking about it over and over?
Wan's mother says her son doesn't understand how serious the situation is. If he fails the gao kao, he'll fail to find a good job. And as any Chinese parent knows, without a good job, there's little hope for...
Students: Prosperity. Prosperity.
In Shanghai, I'm Rob Schmitz for Marketplace.
You can find out more about the gao kao and China's education system on Rob's Chinopoly blog.