AI And Related Technologies Could Create Around 90 Million More Jobs In China Than They Displace Over Next Two Decades

  • Around 26% of existing jobs in China could be automated over the next 20 years, but this is projected to be more than offset by job creation of 38%, giving an estimated net gain of 12%

  • Services (+29%) and construction (+23%) could see the largest net increases in jobs by 2037 in China, offset by estimated net job losses of around 10% in agriculture

  • Positive net job impacts in China contrast with a broadly neutral estimated impact for the UK

Hong Kong, 19 September 2018 – AI and related technologies such as robots, drones, and autonomous vehicles could provide a net boost to employment in China of around 12% over the next two decades, equating to about 90 million additional jobs.

Launching the analysis at the World Economic Forum Annual Meeting of the New Champions in Tianjin, PwC estimates that the boost from AI and related technologies to economic growth in China could create millions of new jobs, more than offsetting displacement of existing jobs. However, the report argues there is no room for complacency given the projected scale of disruption to the labor market from these technologies.

This new analysis for China contrasts with PwC’s earlier research suggesting a broadly neutral net impact of AI and related technologies on jobs in the UK. In that analysis, PwC found that these technologies could displace around 20% of existing UK jobs by 2037, but could create a similar number of additional jobs by boosting economic growth. Based on previous research, PwC judges that result for the UK are likely to be broadly similar to the average across OECD countries.

Relative to the UK estimates, China is projected to see a higher level of job displacement (26% vs. 20%) due to the greater scope for further automation in manufacturing and agriculture in China. However, this is more than offset by the larger estimated boost to GDP in China from AI and related technologies, which will also feed through into much greater job creation in China (38%) relative to the UK (20%). The table below sets out the results for China in more detail.

John Hawksworth, lead author of the report and Chief Economist, PwC UK, commented that:

“We expect the sectors are benefiting most from AI and robotics to be those such as healthcare that combines strong underlying demand growth with a relatively high propensity to see benefits from the application of these technologies. However, it is important to recognize that most of the new jobs created will have nothing directly to do with AI or robots, but will be the product of a richer society with consequent increased demand for goods and services of all kinds.

“While we project the net economic impact of AI to be positive, these technologies will be disruptive, and our analysis, therefore, suggests no room for complacency. For governments around the world, the challenge is to maximize the benefits from these technologies, including continuing to invest heavily in the development of world-class AI skills, while mitigating the costs to displaced workers through retraining programmes and a stronger social safety net, funded from the proceeds of increased economic growth. Only in this way can the potential benefits from AI and related technologies be spread as widely as possible across society.”

The study highlights great opportunities to business from investing in AI and related technologies in China, covering all aspects of operations from marketing and product personalization to R&D, productive efficiency, human resource processes, and cybersecurity. It also warns there is likely to be significant disruption to existing business models in all parts of the economy, as already seen in sectors like media, entertainment, finance, and retail.

James Chang, China Financial Services Consulting Leader, PwC China, commented that:

“As China becomes more innovative and less imitative, Chinese industrial employment is likely to shift from a lower value, labor-intensive production to higher value roles, including those involved in the manufacture of AI-enabled equipment for export as well as to meet rising domestic demand.

“Although our findings suggest that the long-term net effect of AI on jobs will be positive for China, the transition to an AI-enabled economy could see considerable disruption to current labor markets as millions of workers need to switch careers and possible locations. China’s ambitious Next Generation AI Plan targets heavy investment in skills development. However, this will need to be balanced by increased retraining and support for displaced workers.”

Anand Rao, Global Artificial Intelligence Leader, PwC, commented that:

“The opportunity for AI in China is on a scale that demonstrates the transformative impact that the technology can have on society. It will also mean a ripple effect on the global economy regarding accelerating innovation, integration, and efficiencies that pass through the supply chain globally. The findings show that while technology could displace many jobs formerly done by humans, it will also create at least as many additional jobs and greatly increase economic value. It reinforces our belief that the long-term, economic impact of AI is in its application and integration with people’s work, not in simply replacing them.”

The report notes that a job being at “high risk” of being automated does not mean that it will be automated, because of a range of economic, legal and regulatory, and organizational barriers to the adoption of AI and related new technologies. For China, while almost 40% of jobs could be susceptible to automation by 2037, PwC’s central estimate is that only around a quarter of existing Chinese jobs will be displaced over this period, as compared to 38% job creation.

About PwC – Globally At PwC, our purpose is to build trust in society and solve important problems. We’re a network of firms in 158 countries with more than 236,000 people who are committed to delivering quality in assurance, advisory and tax services. Find out more and tell us what matters to you by visiting us at www.pwc.com.

PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity. Please see www.pwc.com/structurefor further details.

PwC – Mainland China, Hong Kong, Macau, Taiwan, and Singapore PwC China, Hong Kong, Macau, Taiwan, and Singapore work together on a collaborative basis, subject to applicable local laws. Collectively, we have over 860 partners and over 22,000 people in total.

We provide organizations with the professional service they need, wherever they may be located. Our highly qualified, experienced professionals listen to different points of view to help organizations solve their business issues and identify and maximize the opportunities they seek. Our industry specialization allows us to help co-create solutions with our clients for their sector of interest.

We are located in these cities: Beijing, Shanghai, Hong Kong, Shenyang, Tianjin, Dalian, Jinan, Qingdao, Zhengzhou, Xi’an, Nanjing, Hefei, Suzhou, Wuhan, Chengdu, Hangzhou, Ningbo, Chongqing, Changsha, Kunming, Xiamen, Guangzhou, Shenzhen, Macau, Haikou, Taipei, Chungli, Hsinchu, Taichung, Tainan, Kaohsiung and Singapore.

 

 

Email This Post Email This Post

Review overview
NO COMMENTS

Sorry, the comment form is closed at this time.