Civil service exam applicant numbers hit a new high, so why are civil service exam prep providers like Huatu Shanding and Fenbi finding it harder and harder to make money?

**Key points**

**1. The civil service exam boom is a reassessment of career risk, not just a preference for stability**

Graduates of the class of 2026 are expected to number 12.7 million. As positions in real estate, the internet and other sectors shrink and expectations for income growth and security outside the system decline, stable jobs have become more attractive.

**2. Strong demand for training does not mean training providers can make money**

What candidates really want to buy is a job offer; institutions can only sell teaching services. Guaranteed-refund classes and training loans amplify advance payments and refund liabilities, leading to refund disputes and cash-flow risks.

**3. Shrinking recruitment directly squeezes the interview-training market**

Recruitment for national and provincial civil service exams has declined, limiting the customer base for high-priced interview training. Huatu Shanding says combined national and provincial exam recruitment in 2026 was about 216,700 people, down 14.3% year on year.

**4. The internet, AI and regulation are all squeezing profits**

Free question banks, low-priced courses and AI grading are weakening pricing for basic courses, while the cost of offline branches is hard to cut quickly. Fenbi's training revenue fell 17.5% in the first half of 2026, and its gross margin dropped from 54.0% to 41.8%. Regulation also restricts result-guarantee advertising and advance fee collection. 2026-10-28 00:10Young people are keen to take the civil service exam, but civil service exam training institutions are finding it harder and harder to make moneyQin Shuo Friends CircleQuick read

This article comes from the WeChat public account: Qin Shuo Friends Circle, author: Ji Zhongzhan

Registration for the 2027 national civil service exam has just ended. As of 16:00 on October 24, 3.025 million people had passed qualification review, competing for 35,691 planned recruitment slots. On average, about 85 people are competing for one position. Although the number of people passing review this year has fallen somewhat from last year, competition for the civil service exam remains fierce. Of course, it should be noted that national exam recruitment quotas have declined for two consecutive years, and the 2027 quota was about 2,400 fewer than the previous year.

Logically, civil service exam training institutions should be happy. The harder the exam and the fiercer the competition, the more candidates need to spend money on courses and tutoring services. Moreover, several million people register every year, and a considerable number of them will prepare repeatedly. By any measure, this looks like an excellent business.

But the financial reports of several listed civil service exam training companies tell another story. In the first half of 2026, Huatu Shanding's operating revenue fell 10.49% year on year, and net profit fell 84.71%; Fenbi's revenue fell about 16.3%, turning from profit to loss; although Zhonggong Education achieved a profit, revenue from its civil service recruitment training business grew only 0.14%.

The matter does not stop there. To compete for candidates, some training institutions launched guaranteed-refund classes that refund money if the candidate fails, and even brought loans into the training business. As a result, institutions originally meant to help young people pursue career opportunities have frequently been questioned by consumers because of enrollment promises, refund difficulties and training loan disputes, and some institutions are even on the verge of collapse.

An interesting question arises: several million people are competing to take the civil service exam, yet the training institutions that make a tutoring business out of these millions are finding life harder and harder?

Behind this are not only the operational problems of training institutions, but also changes in Chinese young people's career choices.

Why do Chinese young people love taking the civil service exam?

Chinese people's fondness for the civil service exam is not a phenomenon of just the past few years.

In 1994, only about 4,400 people registered for the first national civil service exam; in 2003, the number of people passing registration review reached 125,000; by the 2026 national exam, that number had reached 3.718 million. Over more than three decades, the civil service exam has gone from a new open recruitment system to a career competition that attracts millions of participants every year.

Chinese society has long had a preference for jobs within the system. A stable occupational identity, relatively comprehensive security, and the social recognition attached to the civil service profession have given it an important place in the career choices of many families and young people. Especially in some small and medium-sized cities, a civil service job means not only an income but also a relatively stable and predictable life.

But if we explain today's civil service exam boom only by saying that Chinese people like stability, we probably fail to reflect the current environment.

Over the past two decades or more, China's economy grew rapidly, and sectors such as the internet, real estate and finance once created a large number of high-income jobs. For many young people, entering a fast-growing company might mean doubling their income within a few years; if they caught a new industry, they might even have a chance to change their fate quickly through the company's growth.

At that time, the stability of civil servants was certainly enviable, but opportunities outside the system were equally attractive.

Now the situation has changed. The real estate industry is undergoing deep adjustment, the internet and other sectors have bid farewell to rapid expansion, and some jobs that were once coveted are beginning to face pay cuts, layoffs and narrowing room for career development. At the same time, the number of college graduates is still increasing. The class of 2026 national regular college graduates is expected to reach 12.7 million, an increase of 480,000 from the previous year.

For young people who have just entered society, the difficulty of finding a job is not only whether they can get an offer, but also how long the job can last, whether income can continue to grow, and whether there will still be room for development five years from now.

The civil service profession itself has not suddenly become better. What has changed is its comparison with other professions. When income growth expectations for some corporate jobs decline and career risks rise, a relatively stable job naturally appears more attractive.

This calculation is not something young people are making alone. For many ordinary families, raising a college student has already meant more than a decade of time and considerable education costs. After graduation, parents hope their child will have a stable job, be able to gradually live independently, and also make plans for future housing, marriage and children.

In this situation, a job that may pay more but is also more uncertain looks less attractive compared with a civil service position. So the new wave of enthusiasm for civil service exams is less a case of young people suddenly being unwilling to take risks than of their recalculating the risks and returns of different careers.

When growth opportunities outside the system are no longer as abundant as in the past, stability has changed from one advantage in career choice into something more and more people are willing to prioritize.

When exam preparation becomes a business

Where there are exams, there are people offering training. After the national civil service recruitment examination system was established in 1994, as recruitment gradually became more open and standardized, textbook publishing, pre-exam tutoring and training services around the exams also slowly formed an independent market.

This business has two very good key elements:

1. The exam content is relatively standardized. Subjects such as administrative aptitude and essay writing have relatively stable exam requirements, so training institutions can organize teachers to study question types, compile textbooks and develop courses, then replicate a mature teaching system in different cities;

2. Candidates are renewed every year. New graduates keep entering the market, and those who fail may also continue to take the next year's exam. As long as the civil service profession remains attractive, training institutions will not lack potential customers.

Thus, from textbooks, question banks and recorded courses to written exam training and interview boot camps, civil service exam training gradually developed a complete product system. Institutions such as Huatu, Zhonggong and Fenbi grew large one after another, and listed companies also appeared in the industry.

This was once a very good business. Courses could be sold repeatedly, teaching research results could be used in different regions, and the larger the enrollment scale, the easier it was to spread some costs. National brands and branch networks could also help institutions gain more students. But this business also had an inherent problem: what candidates really want to buy is the chance to become a civil servant, while what training institutions can sell them is only teaching services. These two are not the same thing.

Whether a candidate who spends thousands or tens of thousands of yuan on training can ultimately pass depends not only on whether the teacher teaches well, but also on their own foundation, competition for the position and on-the-spot performance. Training can help them improve their scores, but it cannot increase the number of recruitment slots.

What is more troublesome is that consumers often find it hard to judge before paying whether a course is really worth it. To make candidates believe that spending money is useful, institutions need to display famous teachers, teaching results and success stories. But in an increasingly competitive market, simply promising to teach well is obviously less attractive than promising a refund if the candidate fails.

So agreement classes appeared. These courses usually charge higher tuition and stipulate that if candidates do not achieve a specific exam result, they can receive a full or partial refund. To candidates, this sounds like a good deal: if they pass, the tuition was worth it; if they fail, they may still get the money back.

For institutions, agreement classes have another meaning. They not only increase the conversion rate of sign-ups, but also allow companies to receive a considerable amount of tuition before classes begin. The more students enrolled, the more cash comes in on the books. But this money has a problem: part of the tuition received today may have to be refunded tomorrow.

If an institution uses large amounts of advance payments to open branches, pay wages, market and expand, but does not set aside enough funds for possible future refunds, then the cash flow that looked good when enrolling students may turn into enormous financial pressure a few months later. Once enrollment slows, or a large number of candidates apply for refunds at the same time, the company must come up with real money to honor its promises, which brings fatal risks to training institutions.

Some institutions also brought loans into this business. A young person who has not yet found employment may not be able to afford tens of thousands of yuan in training fees. Sales staff then introduce installment payments or third-party training loans. The candidate signs a loan contract, the loan funds are used to pay tuition, and the institution can receive the training payment in advance.

For institutions, candidates who originally could not afford to pay can now sign up. But for candidates, things are not so simple. The training contract and the loan contract are two different matters. Even if the exam is failed and the refund conditions agreed with the training institution are met, the candidate still needs to repay the tuition loan to the third-party financial institution. If the training institution does not refund in time, or refuses to refund for various reasons, the candidate may still need to continue repaying principal and interest. They failed the civil service exam but ended up in debt first.

This is not merely a theoretical risk. In 2023, the Jiangsu Provincial Consumers Council released a consumer survey report on the civil service and postgraduate exam education training market, obtaining 11,588 valid questionnaires and conducting on-site experiences with 11 institutions. The survey reflected problems such as induced training loans, difficulty obtaining refunds, and publicity inconsistent with services. Among them, 40.2% of respondents believed that staff induced them to use training loans before payment.

What is bad about this is that when a training institution increasingly relies on advance fees to sustain operations and lacks the ability to honor refund promises, what it sells is not just a course, but also a liability that may be impossible to pay in the future. And just as some institutions are paying the price for past expansion, the external environment of this business has also begun to change.

First, the number of recruitment positions has decreased. Among the products of civil service exam training, written exam courses are relatively easy to standardize, and their fees are also more susceptible to competition. Interview training requires on-site simulations, teacher comments, and personalized tutoring, and usually can charge higher fees. But high-priced interview training is not aimed at the millions of applicants, but at the small portion of them who enter the interview stage. In its 2026 semi-annual report, Huatu Shanding mentioned that the combined recruitment scale of the national exam and provincial exams that year was about 216,700 people, a year-on-year decrease of 14.3%, which had an impact on the interview training business. No matter how hot exam registration becomes, it cannot change the fact that the number of customers for high-priced interview training is constrained by the recruitment scale.

Another change comes from the internet, especially AI. In the past, candidates who wanted to systematically study the Administrative Aptitude Test and Essay Writing often needed to buy textbooks, courses, or attend offline training. Now, there are a large number of free question banks, low-priced courses, and past exam question analyses online. Local training schools, interview studios, and even independent teachers can also recruit students directly through short videos and livestreams.

AI has pushed this one step further. Question drills, wrong-answer analysis, and assisted grading for essay writing—more and more work that originally required teacher participation can be handed over to intelligent tools. Of course, it can also help training institutions reduce costs and develop new products, but when the same capabilities are mastered by more and more institutions, it becomes harder for courses to maintain past prices.

Technological progress does not necessarily only allow companies to earn more profit; it may also allow consumers to spend less money. For large institutions with many offline branches, teachers, and management personnel, the pressure is especially obvious. The organizational system that once supported nationwide expansion was an advantage when revenue was growing; when course prices fall and enrollment fluctuates, it can also become a cost that is not easy to quickly compress.

Fenbi's financial report provides a sample. In the first half of 2026, its training service revenue fell 17.5% year on year, gross margin dropped from 54.0% in the same period last year to 41.8%, and the total number of employees decreased from 7,005 at the end of 2025 to 5,963.

At the same time, regulation has also begun to impose clearer requirements on result-guarantee-style advertising and prepaid fee management. In June 2026, Beijing issued relevant standardized management measures, further constraining the enrollment methods that some training institutions previously relied on.

Looking back, the civil service exam training industry has gone through a rather interesting process.

Initially, the institutionalization of the civil service exam created training demand. Subsequently, growth in the number of applicants, course standardization, and nationwide channel expansion made it a good business that could be rapidly scaled up. But in order to gain more students in competition, some institutions tied fees to exam results and expanded consumers' ability to pay through loans and other means. As scale grew, refund liabilities and funding risks also accumulated.

Of course, there are still many people who want to take the civil service exam. But from having a business, to becoming a good business, to today becoming increasingly difficult to make money from, the experience of the civil service exam training industry illustrates one thing: having many customers does not mean an enterprise is certain to make money; making revenue very large does not mean the business model can withstand the test.

In some countries, taking the civil service exam is also a big business.

Civil service exam training is not a business unique to China. Many countries around the world have civil service recruitment systems, but the training markets formed around exams differ greatly.

India is relatively similar to China.

In India, entering government service is likewise an important career goal for many young people. Stable income, social status, and job security make some public sector positions highly attractive. The civil service exam organized by the Indian Union Public Service Commission (UPSC) attracts a large number of candidates every year, while the final number of hires is quite limited.

Around this exam, India has formed a training industry of considerable scale. In areas such as Mukherjee Nagar in New Delhi, training schools, bookstores, dormitories, and catering services are clustered together. A large number of young people come here and spend several months or even years preparing for the exam. The civil service exam not only supports training institutions, but also drives a whole set of local businesses formed around candidates' lives.

But India's training market also has controversies over enrollment advertising and consumer rights. In November 2024, the Central Consumer Protection Authority of India issued guidance rules targeting misleading advertisements in the training industry, focusing on constraining institutions' use of exam success cases, hiring results, and false promises to attract students.

This has similarities with the problems faced by China's civil service exam training: candidates care most about the final result, but training institutions cannot guarantee the result. The more competitive and higher-priced the market, the more incentive institutions have to use success cases to prove themselves, and the more likely consumers are to associate teaching services with hiring opportunities.

Japan is another situation. Japan's national and local civil service exams have different categories and selection procedures, and specialized tutoring schools and training courses have also formed around the exams. However, in addition to written exams, civil service hiring also involves subsequent selection such as interviews. Training institutions can help candidates prepare for exams, but cannot determine the final hiring result.

The situation in the United States is different again. The U.S. federal government does not have a unified hiring exam covering all civil service positions. Different positions use different selection methods such as experience review, professional assessment, written exams, or interviews according to job requirements. Some states, cities, and specific positions have civil service exams, and corresponding tutoring services also exist, but it is difficult to fit all civil service job seekers nationwide into the same set of training products.

Comparing several countries reveals a pattern: whether civil service exam training can become a big business depends not only on how many people want to enter government departments, but also on whether exam content can be standardized, whether courses can be sold repeatedly, and whether competition for positions is fierce enough that candidates are willing to spend money to improve their scores.

China and India share many similarities in these respects. Japan has developed a tutoring market suited to its own recruitment system, while the United States, because its recruitment methods are more decentralized, lacks a unified training market covering federal civil service positions. Therefore, the scale of the civil service exam training industry depends not entirely on how good educational institutions are at doing business, but also on how a country selects civil servants and how attractive public-sector jobs are in the overall job market.

When more and more young people want to enter the system, what should we really care about?

Returning to the 2026 national civil service exam. 2.831 million people actually took the written exam, competing for 38,119 recruitment slots. At least 2.79 million people ultimately failed to obtain a civil service position through this exam. Some continued to take provincial exams and public institution exams, some decided to prepare for another year, and others returned to the corporate recruitment market.

For every young person, this is their own career choice. There is nothing unreasonable about wanting stable work and predictable income. Civil servants bear important public service responsibilities and also need to attract outstanding talent. But if we shift our gaze away from any single candidate and look at this competition in which millions of people participate together, another question worth considering emerges.

The number of civil service positions is limited, but there is no clear upper limit on the time and money candidates can invest. One person may improve their score by spending a year preparing; another person also invests a year in order not to fall behind. Some attend training, and others may also buy courses. When more and more candidates master similar test-taking methods, the competition does not necessarily become easier.

For individuals, every investment may be meaningful. But overall, the time and money spent by millions of people will not, just because competition becomes fiercer, create a corresponding number of additional civil service positions in society. This cost is not reflected only in training institutions' operating revenue. It also includes some young people not having formal employment for a long time after graduation, families continuing to bear living expenses, and the other career opportunities they temporarily give up.

Of course, the knowledge and abilities gained during exam preparation are not worthless, and outstanding talent entering the public sector can also create value for society. The question is, when a large number of young people concentrate their hopes for career development on a small number of positions, should we also care about why they did not choose other paths?

In the past, China's economy developed rapidly, and new industries kept creating job opportunities one after another. Entering a company meant the opportunity to earn higher income, accumulate experience, achieve promotion, and even start one's own business. Young people today also hope to have these opportunities. It is not necessarily that they are unwilling to take risks, nor that they lack ambition. But for a young person who has just graduated and has little savings, if a job can provide neither reliable labor protection nor clear room for growth, then no matter how inspiring the development story is, it can hardly compare with a stable job offer.

So rather than simply discussing whether young people are too eager for stability, the more important question is whether enough attractive jobs can continue to be provided outside the public sector. These jobs do not necessarily all need to have high starting salaries, but they should make people believe that hard work can earn reasonable income, that accumulating abilities can bring career growth, and that when industry changes occur, people will not easily lose basic security.

China's economy needs excellent civil servants, and also excellent engineers, researchers, business managers, entrepreneurs, and millions of ordinary workers creating value in different positions. If young people have more jobs worth choosing, civil service will still be a respected profession, but it will not need to carry so many families' expectations for a stable life in the future.

The rise and fall of the civil service exam training industry is a window for observing this change. It shows us that career competition can create enormous commercial demand, but may not bring better results for all participants. And what is truly worth caring about in the civil service exam craze is not only how many people register and how many are hired each year.

The vitality of a society is reflected not only in how many outstanding young people are willing to enter the public sector, but also in how many good jobs worth choosing exist outside the public sector. Channel: Society and Culture This content comes from the internet and the original link. The views represent only the author and do not represent the position of Huxiu. If there are copyright issues, please contact hezuo@huxiu.com, and we will verify and handle them promptly. Everyone who is changing and wants to change the world is on the Huxiu APP[ ]