Future tech

Rapidly growing digital economy set to give China 415m jobs, account for nearly half of GDP

Technology will swallow up repetitive predictable jobs but on balance create far more opportunities, BCG and AliResearch study indicates

PUBLISHED : Tuesday, 10 January, 2017, 5:23pm
UPDATED : Wednesday, 11 January, 2017, 7:59am

China’s digital economy, already home to the world’s largest population of internet and smartphone users, is likely to create 415 million jobs by 2035, bolstering technology’s share to 48 per cent of gross domestic product, according to forecasts by the Boston Consulting Group and AliResearch Institute.

Low-skilled, menial and repititive jobs will be replaced by robots, artificial intelligence and intuitive technologies such as touch screens, as well as voice and facial recognition software. Technology would displace menial jobs but would also create new opportunities, the report said.

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The forecasts come at a time when AI invested by two of the world’s largest internet search operators is increasingly showing its mettle in competitions against humans. Google’s DeepMind has developed AlphaGo, which triumphed over human players of Go in 60 matches in China, while Baidu is entering its AI bot in game shows to solve complex problems.

AI would replace some jobs, including researchers, AliResearch head Gao Hongbing said.

“There will be AI-powered think tanks and some basic research will be done by machines,” he said. Humans would be added to the workforce, using their skills in certain areas to monetise their know-how via online platforms, he said.

Germany offers a good parallel experience. The BCG study found drones and automation would remove 610,000 factory floor jobs in Germany but by 2025 advances in technology would lead to 960,000 new opportunities in information technology and communications.

“Germany’s Siemens has about 300,000 workforce, which means the new technology will wipe out two Siemens but at the same time create three Siemens. Think about that,” said Ruan Fang, partner and managing director of BCG .

As machines become smarter, people are able to work no matter where they are in a more flexible way via the internet. AliResearch, a think tank affiliated with e-commerce giant Alibaba Group, predicted that about 400 million people in China would be self-employed through online platforms, waving goodbye to the traditional eight-hour working mode by 2036.

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For example, Chinese ride-hailing giant Didi Chuxing lets 15 million people who have driving licenses make money by offering services via its platforms. Alibaba’s online marketplace Taobao, which has 8,000 employees, facilitates the business of hundreds of thousands of suppliers and three million delivery staff. Alibaba owns the South China Morning Post.

Hao Jian, the chief consultant at China’s major online recruiting firm, said he had witnessed the same trend as people no longer needed to be employed by a certain company; they could simply find project-based work opportunities online.

“The demand for part-time jobs enjoyed the most rapid growth - 113 per cent year-on-year [last year] compared with the other 60 job categories Zhaopin has,” he said.

He said AI was good at finding patterns by analysing massive amounts of data.

“But jobs that require creativeness, involve emotions and tend to break rules rather than follow rules can never be replaced by machines,” he added.

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The report foresaw that some low-skilled and repetitive tasks would be replaced by hi-tech equipment and technologies such as touch screens, robots and facial recognition without giving exact numbers of job cuts in the future. But the report emphasised that job opportunities created by the digital economy more than compensated for those positions that would disappear.

The report cited a World Bank report which estimated 55 to 77 per cent of China’s low-skilled workforce could be replaced by technology, while employees had to cultivate skills and know-how that would not be easily replaced by digital technologies.