This article attempts to investigate the relationship between the massification of higher education, labour market and social mobility in contemporary China. Though only a short period of time has elapsed from elite to mass education, China's higher education has been characterised as a wide, pervasive massification process. Similar to other East Asian countries/economies like South Korea, Taiwan and Hong Kong, the expansion of higher education in China has also generated a great impact on labour markets and social mobility. The massification of higher education has increased college access and in general enhanced the extent of equity and equality in society. Nonetheless, the situation has become far more complex as returns of education have flattened out recently and social mobility has slowed down in general. University students have started to doubt the ability of higher education to improve their competitiveness in the job market. This, in turn, has led to a wide dissatisfaction with higher education development in China, particularly when higher education has experienced highly intensified competition in the context of world-class university movement. Realising that students from different family backgrounds may encounter diverse experiences in graduate employment and opportunity for upward social mobility, this article critically reflects upon how variations in social capital and cultural capital have impacted on graduate employment and social mobility as higher education has massively expanded in China.