Key Takeaways
- AI adoption in China is accelerating rapidly, driven by strong government policies such as the “AI Plus” initiative and a five‑year plan through 2030.
- Layoffs are already visible in tech‑intensive roles; programmer Fei Zhaojun and ~160 colleagues were dismissed after his boss questioned whether AI could replace coders.
- The share of Chinese industrial enterprises using AI models jumped from 9.6 % in 2024 to 47.5 % in 2025, according to IDC, while open‑source ecosystems are narrowing the gap between model capability and real‑world value.
- Displacement extends beyond coding to translation, short‑form video, and service sectors, with humanoid robots sorting parcels, directing traffic, and delivering food.
- Women face a higher risk of AI‑related job loss because they are over‑represented in automatable tasks such as electronics assembly and under‑represented in STEM fields (ILO).
- China’s overall urban unemployment hovers around 5 %, but youth unemployment (16‑24, excluding students) is roughly triple that rate, compounding concerns about social stability.
- Despite productivity gains, economists warn AI could worsen employment gaps and slow consumer spending, especially amid a prolonged housing‑market downturn.
- Demographic trends—an aging, shrinking population—may eventually reduce the labor‑force pressure, with automation potentially offsetting a future shortage of workers.
- Many displaced workers are pivoting to AI‑enabled entrepreneurship: creating vlogs, independent children’s books, or using AI as a supplemental tool in teaching and translation.
- Experts agree that while AI will lift overall productivity, its net effect on jobs remains uncertain, requiring proactive reskilling and social‑policy measures to mitigate disruption.
Layoffs and the rise of AI in China’s tech sector
Fei Zhaojun, a 40‑year‑old computer programmer in Beijing, recalled his boss asking bluntly whether artificial intelligence could soon replace humans in coding jobs. Two weeks later, Fei was laid off together with about 160 of his colleagues. “Mid‑level coders’ job are essentially replaceable in most of the cases,” Fei told the Associated Press, adding, “Even if it is a disaster that leads to replacing all humans, at this stage, you just have to use it as everyone else is using it.” His experience mirrors a growing wave of layoffs as firms experiment with AI‑assisted development tools, reflecting a broader trend in which firms test AI’s capacity to perform routine programming tasks before committing to full‑scale automation.
Government‑driven AI diffusion and the “AI Plus” initiative
China’s push to embed AI across the economy is anchored in the state‑led “AI Plus” initiative and its five‑year plan extending to 2030. “What is specific to China is that the government is really into diffusing AI across the economy, so AI may get into different domains more quickly compared to other countries,” said Zilan Qian, a research associate at the Oxford China Policy Lab. This policy thrust has yielded measurable results: the proportion of Chinese industrial enterprises reporting the use of AI models and “agents” surged from 9.6 % in 2024 to 47.5 % in 2025, according to market‑intelligence firm IDC. IDC senior research manager Yanze Du noted that China’s vibrant open‑source model ecosystem is “fostering greater AI application innovation in industrial settings, gradually closing the gap between foundational model capabilities and real‑world enterprise value creation.”
Sector‑wide displacement: from coding to translation and short‑form video
The ripple effects of AI extend far beyond software engineering. Du Qinchun, a part‑time translator based in Chengdu, has been helping to train an AI model to do translations, which has brought him temporary work but also highlighted a stark wage decline. “But it’s true that the pay in the industry has been cut by more than half compared to what it was years ago,” Du said. The trend has contributed to waning interest in traditional foreign‑language majors at Chinese universities as AI‑powered translation tools become ubiquitous. In the cultural sphere, generative AI is reshaping China’s short‑drama industry; the number of live‑action short and vertical video series designed for mobile phones fell about 75 % in the first quarter of this year compared with a year earlier, according to Chinese media reports. As Plenum senior analyst Shujing He observed, “Tasks that once required specialized training can now be performed by almost anyone with access to AI tools… workers whose roles are narrowly concentrated in these areas may face greater displacement risk.”
Humanoid robots and service automation
Automation is also making inroads into physical service jobs. Humanoid robots displayed at the World Artificial Intelligence Conference in Shanghai are already sorting parcels in postal centers on a small‑scale basis, and they are being tested for tasks such as directing traffic and making coffee. Food‑delivery robots are gaining traction across cities, raising concerns about the livelihoods of millions of Chinese delivery workers who rely on gig‑based income. These developments illustrate how AI is moving from purely digital domains into the tangible world of logistics and urban services, further expanding the spectrum of occupations vulnerable to machine substitution.
Gender disparities in AI‑related job loss
The impact of AI is not evenly distributed across the workforce. A report from the International Labour Organization found that women face a higher risk of losing employment due to AI than men, largely because they tend to be concentrated in automatable roles such as electronics assembly and remain under‑represented in science, technology, engineering, and mathematics (STEM) fields. This gender gap exacerbates existing inequalities and could deepen social tensions if displaced women lack access to retraining programs or alternative employment pathways.
Economic context: slowing growth, consumer caution, housing slump
China’s broader economic backdrop adds urgency to the AI‑employment debate. The nation’s growth has been decelerating, consumer spending has lagged as households become wary of job losses, and a prolonged downturn in the housing market has eroded household wealth. These factors combine to create a fragile environment where job insecurity can quickly translate into reduced demand, threatening a vicious cycle of lower consumption and further economic slowdown. Economist Eswar Prasad of Cornell University warned, “AI is likely to lift productivity across the board but could have a severe disruptive effect on employment, worsening the employment growth problem and resulting in a detrimental effect on social stability.”
Productivity gains vs. employment disruption
While AI promises efficiency improvements, its net effect on jobs remains contested. Prasad’s caution echoes the sentiments of many analysts who see a trade‑off: higher output per worker could coexist with fewer workers needed to achieve the same output. The displacement risk is especially pronounced for roles that are routine, rule‑based, or easily codified—precisely the categories where current AI tools excel. Policymakers therefore face the challenge of harnessing productivity gains while mitigating the social costs of rapid technological change.
Youth unemployment and demographic pressures
Official statistics show China’s overall urban unemployment rate hovering around 5 %, but the situation is far more dire for young people. Unemployment for those aged 16 to 24, excluding students, is roughly triple the national average, heightening concerns about a “lost generation” of workers entering an AI‑disrupted market. At the same time, China’s demographic trajectory presents a looming challenge: by 2050 the country is projected to have fewer than two working‑age adults to support each retiree, compared with more than 2.5 in the United States. Professor Xuenan Cao of San Francisco Bay University suggested that “automation could partially offset a shrinking workforce rather than being purely a threat to it,” implying that AI might eventually become a necessary buffer against labor‑force contraction.
Individual adaptation: turning AI into entrepreneurial tools
Amid the uncertainty, many displaced workers are experimenting with AI to carve out new livelihoods. Wang Zhicheng, 32, previously a scriptwriter for a children’s‑education company, resigned after his employer cut half of its script‑writing team. He now runs his own studio producing illustrated children’s books, treating AI as a brainstorming aid: “You can treat AI as a tool just like (Microsoft) Word… Humans are still the decision makers on which one to pick or pursue among all that AI generates.” Likewise, high‑school chemistry teacher Yang Zheng, 29, views AI as a supplement rather than a replacement: “Teachers cannot be there all the time… It is a good thing for students as it generates in real‑time so that students can ask follow‑up questions.” Even Fei Zhaojun, after his layoff, has begun producing vlog‑style short videos about ordinary people’s lives during a career break, hoping the content might help others navigate similar transitions.
Outlook: AI as both threat and potential buffer for shrinking workforce
Looking ahead, experts remain divided on whether AI will ultimately deepen China’s employment challenges or alleviate them. In the short term, rapid adoption threatens to displace workers in routine cognitive and manual jobs, potentially exacerbating youth unemployment and straining social safety nets. In the longer run, however, the nation’s aging and shrinking population may necessitate greater reliance on automation to maintain economic output. As Cao noted, automation could serve as a compensatory mechanism for a diminishing labor pool. Realizing this potential will depend on effective reskilling initiatives, inclusive education policies, and social‑protection systems that help workers transition from threatened roles to emerging AI‑augmented opportunities. Without such measures, the promise of AI‑driven productivity may be overshadowed by heightened inequality and social unrest.
https://www.pbs.org/newshour/world/workers-in-china-worry-over-being-replaced-as-they-adapt-to-the-growing-impact-of-ai-on-jobs