AI boom explodes China’s unemployment time bomb
Beijing is ‘increasingly worried about Chinese people worrying about losing their jobs’
Unemployment is no longer a ticking time bomb in China. It has already exploded, despite the fake figures coming out of the National Bureau of Statistics. For the past decade, the overall jobless rate has hovered from 4% to 5.7%. In March, it was 5.4%.
But the numbers fail to reveal the true state of the world’s second-largest economy. Or, the price being paid by ordinary Chinese people if they still have a job in the rush for high-tech, AI-fueled automation. Hardest hit will be factory workers and low-level office personnel.
“[The Communist Party of China] is increasingly worried about Chinese people worrying about losing their jobs to AI [or artificial intelligence],” Matt Sheehan, of the Carnegie Endowment for International Peace think tank, posted on Substack earlier this month.
Behind the news:
- Up to 30 million manufacturing jobs have been lost in the past decade to automation.
- More than 30% of urban jobs, or 142 million workers, could be at risk of AI fallout.
Delve deeper: It comes at a time when the population is shrinking and low-skilled employment is disappearing. But the rise of artificial intelligence is now threatening the existence of the country’s middle class, as it struggles with declining household wealth.
[The Communist Party of China] is increasingly worried.
Matt Sheehan, Carnegie Endowment for International Peace
Between the lines: “AI may substitute some jobs, but it will also create new ones,” Sun Zhongwei, a professor at South China Normal University in Guangzhou who studies the country’s labor markets, pointed out earlier this year.
Why it matters: “The key is whether the upgrading of our workforce – improving its quality and transforming people’s skill sets – can keep pace with the technological changes,” he told The Wire China, as the scourge of mounting unemployment grows.
Big picture: These fears are magnified by the emergence of “dark factories,” powered by robots and AI. They “operate without human workers or traditional lighting.” Still, in the background, there are AI system trainers, technicians, and data analysts.
Bottom line: Yet the business model remains the same. “Scale and [massive] state-level support allow [China] to move faster and deploy technology more widely than many [global peer competitors],” Industrial Equipment News, an American legacy publication, reported.
China Factor comment: As the time bomb fragments extend across the unemployment landscape in China, it is time Beijing rolled out measures to help the people cope with change, not enslave them with stagnating living standards.