Xi’s AI ambitions collide with China’s fragile employment market

China installs more factory robots each year than all other countries combined. Read more at straitstimes.com.

BEIJING - Days after back-flipping AI humanoids dazzled China with a new year performance alongside dancers, a small research firm jolted US markets with a stark warning about how automation could trigger an economic spiral by displacing workers.

Intended or not, images of robots swinging nunchucks alongside their human counterparts threw a spotlight on Beijing’s challenge of balancing productivity gains with jobs. While no Chinese companies were referenced in Citrini Research’s dystopian report, similar risks loom for China – America’s most formidable AI rival and home to the world’s largest labor fource.

That’s leaving President Xi Jinping with a dilemma. China can’t afford to hobble itself in the race with Washington for AI capabilities that will underpin advanced manufacturing and technology critical to military advancement. At the same time, the Communist Party needs to ensure enough job creation to prevent social unrest.

“Beijing is aware of the potential for this process to have major societal impacts,” said Paul Triolo, a former US government official and partner at DGA-Albright Stonebridge Group who specialises in China and tech policy. “Officials are also already grappling with high levels of youth unemployment,” making another wave of job displacement harder to deal with, he added.

Only last month, China’s Ministry of Human Resources announced it was drafting policy guidance to address AI’s impact on jobs ahead of March’s release of the country’s five-year development plan. Zhang Yunming, vice industry and technology minister, also in January described employment pressures from AI as “inevitable.”

Despite that, the Asian powerhouse has pushed to embed AI across its economy. China installs more factory robots each year than all other countries combined, leads the world in drone delivery and tests more autonomous cars than anywhere else. Goldman Sachs estimates China will lead the world in adopting autonomous vehicles, with 90 per cent of cars sold there expected to have advanced self-driving ability by 2040.