Chinese Premier Wen Jiabao said Saturday the government encourages university graduates to start their own businesses, as the country is facing serious challenges in employment.

He made the remarks during an online chat with netizens.

Wen said the government can usually create job opportunities for 9 million people a year. However, more than 6 million people graduate from universities annually and need jobs.

Statistics show that the number of Chinese university graduates will reach an all-time high of 6.3 million this year, posing a grave challenge for the country's employment.

"It is a very important task for us to create job opportunities for them," Wen said.

He said the government has called on university graduates to work in relatively underdeveloped central and western regions, border regions and rural areas.

"We particularly hope they can start their own businesses, and we have stipulated many favorable policies in this regard," he said, citing a series of favorable loans.

"The government has always attached great importance to the employment of university students," he added.